Who should use this factory audit checklist?

Startup founders, CTOs, product managers, and supply-chain managers who need a repeatable way to qualify factories. Use it when selecting your first CM, adding a second source, introducing a new variant/rev change, or recovering from quality drift.

The Ultimate Factory Audit Guide — Everything You Need to Know

Q: What is a factory audit?

A factory audit is a structured review of a supplier’s quality system, processes, capacity, and compliance against international standards and your requirements. It’s not just about a product sample—it’s about whether the factory itself can consistently deliver to spec over time.

Q: What’s the difference between supplier vetting and a factory audit?

Supplier vetting is the first filter: reviewing company background, certifications, product range, and basic capacity to decide if a supplier is worth considering. Factory audit is the deep dive: an on-site evaluation of systems, processes, and compliance to confirm if a supplier can consistently deliver quality and scale. Rightway helps you move from supplier vetting to factory audit — using local presence and decades of experience in Asia to save time, reduce cost, and lower risk.

Q: Factory audit vs. product inspection — what’s the difference?

A factory audit evaluates a supplier’s systems and capabilities (quality management, processes, capacity, compliance, supplier control) to judge whether they can consistently meet your requirements. A product inspection checks specific units/lots against your specs and AQL at a point in time (pre-production, in-process, or pre-shipment). Audit = long-term capability; inspection = shipment conformity.

Q: What goes into a factory audit checklist?

Typical checklists include: quality certifications (ISO/IATF), change control & documentation, PFMEA linked to Control Plans, measurement systems (MSA/Gage R&R, calibration), traceability & nonconformance handling, and supplier & incoming quality management.

Q: When should you run a factory audit?

Before PO #1, before ramping, after major design/process changes, supplier switches, or demand surges, and whenever signals of trouble appear (defects, missed deliveries, traceability mistakes, yield dips). Rule of thumb: audit when stakes or complexity increase.

Q: How long does a factory audit take and how often should I re-audit?

Startup-focused audits typically take 1–2 days on-site. Re-audit every 12–24 months, or after major changes such as new line, process shift, ownership change, or critical issue.

Q: What evidence do auditors look for?

Evidence includes: PFMEA & Control Plan updates, MSA/Gage R&R reports for CTQs, calibration logs, traceability records, incoming inspection reports, quarantine logs, CAPA records with closure dates and lessons learned.

Q: What are common red flags a factory audit checklist catches?

Common red flags: paper-only certifications, expired calibration, over-committed capacity, weak change control, traceability gaps, missing containment, and superficial 8D problem solving without root cause checks.

Q: What can go wrong without a real audit?

Systemic quality lapses, regulatory detentions (e.g., CBP WRO/UFLPA), reputational/legal risks from supplier abuses, and shipment delays. Real audits with scoring and must-pass gates mitigate these risks.

nellalin
Aug 31
7 min read

Updated: Sep 3

What is a factory audit and why does it matter?

A factory audit is a structured, on-site assessment of a manufacturer’s systems, capacity, workplace environment, and capabilities against your requirements or recognized standards. It goes beyond checking a single batch of goods—it evaluates whether the factory can reliably meet your quality, compliance, and delivery needs over time. Independent bodies describe audits as tailored programs that verify a supplier can fulfill an order to specification and market/regulatory requirements, not just today but repeatedly.

For startups, audits serve two high-leverage moments: (1) final supplier qualification before placing first POs, and (2) ongoing supplier management to ensure capabilities don’t drift as you scale. This reduces launch delays, certification surprises, and expensive firefighting. (Rightway’s FACTS™ — Factory Audit Framework operationalizes this with 0–5 scoring and must-pass gates.)

What’s the difference between supplier vetting and a factory audit?

Supplier vetting is the first filter: reviewing company background, certifications, product range, and basic capacity to decide if a supplier is even worth considering.

Factory audit is the deep dive: an on-site evaluation of systems, processes, and compliance to confirm if a supplier can consistently deliver quality and scale with you.

Rightway helps you move from supplier vetting to factory audit — using our local presence and decades of experience in Asia to save time, reduce cost, and lower risk. Vetting gives you options; our FACTS™ factory audits give you confidence.

Factory audit vs. product inspection — what’s the difference?

A factory audit evaluates a supplier’s systems and capabilities (quality management, production processes, capacity, compliance, supplier control) to judge whether they can consistently meet your requirements over time. A product inspection checks specific units/lots against your specs and AQL at a point in time (pre-production, in-process, or pre-shipment). They’re complementary: audit = long-term capability, inspection = this shipment’s conformity.

Dimension	Factory Audit	Product Inspection
Scope	System-level review of QMS, processes, capacity, compliance, supplier management	Unit/lot-level checks of workmanship, dimensions, functionality, cosmetics, packing/labeling
Objective	Qualify or re-qualify a factory; reduce execution and compliance risk over the product lifecycle	Accept/reject or hold a specific lot; catch defects early; prevent costly rework/returns
Timing	Before onboarding; and periodically (e.g., annual/biannual) or after major changes/issues	At key order milestones: pre-production, during production (DPI), pre-shipment (PSI)
Evidence	Policies/procedures, PFMEA & Control Plans, training, MSA/Gage R&R, calibration, traceability, CAPA, capacity proof	Samples and measurements, test results, defect maps/photos, AQL reports, packing/label checks
Outcome	Capability & risk profile, corrective plan, go/no-go for supplier	Pass/hold/rework decision for the lot; shipment release notes

How Rightway makes both faster, cheaper, and lower-risk

Rightway delivers both services: the Rightway FACTS™ — Factory Audit Framework for system-level assurance, and on-site product inspections for shipment-level control. Because our team is embedded in Asia’s factory ecosystem (Taiwan/China/SEA) with bilingual engineers and decades of cumulative, hands-on experience, we:

Save time & travel cost by coordinating audits and inspections in-region with rapid scheduling.
Improve efficiency with one plan, one team: audit findings feed directly into inspection focus (critical specs, PTCs, labeling/pack), closing the loop.
Reduce risk by enforcing must-pass gates (e.g., MSA/Gage R&R, Control Plans, traceability) in audits and validating them on the line during inspections.

A deep understanding of culture is another of Rightway's strengths. Business practices in Asia differ significantly from those in Western cultures, particularly in communication styles. Feedback or concerns are often conveyed indirectly and may be observed through subtle cues such as participants’ expressions or the overall atmosphere in a meeting, rather than through explicit statements. Auditors from Western backgrounds may find it challenging to accurately interpret these cultural signals. Furthermore, certain issues may be embedded within documents in ways that are less apparent to non-native speakers, making it difficult to identify discrepancies quickly. These factors can potentially lead to audit outcomes that do not fully reflect the actual situation.

Audit protects your sourcing strategy. Inspection protects your shipment. With Rightway, you get both—locally executed, tightly integrated, results-driven. (See more of our services here)

What goes into a factory audit checklist?

Typical audit checklists cover:

Quality certifications (ISO/IATF)
Change control & documentation
Process controls (PFMEA ↔ Control Plan, setup sign-off, work instructions)
Measurement systems (MSA/Gage R&R, calibration)
Traceability & nonconformance handling
Supplier & incoming quality management These areas confirm both compliance and practical readiness.

Request your free Rightway FACTS™ — Factory Audit Checklist here.

This free version is designed as a quick-start tool for startups and product teams to immediately benchmark suppliers and identify critical gaps.

Note: Rightway internally applies a more detailed 60+ item FACTS™ framework, tailored by product category and used during actual project engagements. If you have deeper or product-specific questions, feel free to contact us for guidance.

When should you run a factory audit?

Run an audit before you send PO #1—and again whenever risk changes:

Pre-award: shortlist → on-site audit → final selection.
Pre-ramp: confirm capacity, preventive maintenance, and control plans match the ramp profile.
Post-change: any major design/process change, supplier switch, or surge in demand.
Signals of trouble: rising defects, missed deliveries, labeling/traceability mistakes, or unexplained yield dips.

Rule of thumb: audit when stakes or complexity increase. It’s cheaper than firefighting after launch.

How long does a factory audit take and how often should I re-audit?

Duration: A startup-focused audit usually takes 1–2 days on site, depending on factory size and product complexity.

Frequency: Best practice is to audit before first PO, and then every 12–24 months, or immediately after major changes (e.g., new line, process shift, ownership change, critical issue).

What evidence do auditors look for?

Auditors don’t just look at paperwork—they check proof of execution, such as:

PFMEA & Control Plan updates tied to actual shop-floor instructions
MSA / Gage R&R reports for CTQs
Calibration stickers/logs at point of use
Traceability records (lot → shipment)
Incoming inspection reports & quarantine logs
CAPA records showing closure dates and lessons learned

What are common red flags a factory audit checklist catches?

Paper certifications, no practice. ISO docs exist, but line work is off-procedure.
Expired calibration or “shared” gages. CTQs measured with uncalibrated tools.
Over-committed capacity. Bottlenecks with no PM; “we’ll buy equipment after your PO.”
Weak change control. ECOs not briefed at stations; old instructions at the bench.
Traceability gaps. Mixed lots, handwritten labels, relabeling without audit trail.
Containment missing. Non-conforming parts flow freely; red tags live in WIP.
8D theatre. Issues “closed” with sorting, no root cause or effectiveness check.

Two or more red flags across different pillars usually means no-go until controls are real.

What if the factory refuses documents or photos?

That’s a signal. Agree on redacted evidence or on-screen review—but lack of transparency is a risk by itself.

What can go wrong without a real audit?

Systemic quality lapses escalate fast. Aviation regulators found ongoing production-quality and process-control issues on the 737 program and imposed enhanced oversight and output caps—a reminder that paperwork alone isn’t enough; you need line-level controls and verification.
Superficial supplier oversight risks legal action. In Italy, probes into luxury supply chains led courts to place units under administration/receivership for supplier abuses and poor oversight—a stark example of reputational and operational damage when upstream auditing fails.
Shipments can be detained at the border. U.S. CBP actively uses Withhold Release Orders and UFLPA enforcement to stop goods tied to forced labor—detentions that create immediate cash-flow and delivery shocks.

Rightway FACTS™ closes these gaps with quantified scoring and must-pass gates, plus local, bilingual execution so you catch risks before they hit your schedule.

Do I need APQP/PPAP as a startup?

If your product requires CE, FCC, automotive, or regulated market access, then APQP/PPAP disciplines help you avoid compliance delays. For most startups, a light APQP (feasibility, PFMEA, Control Plan, run-at-rate) is enough at EVT/DVT. Rightway integrates these tools into FACTS so founders don’t get buried in forms, but still meet the minimum gates investors and customers expect.

What does a robust CAPA look like after the audit?

Problem statement (measurable): “Lot mix-ups in final pack for SKU X (2 incidents in 30 days).”
Root cause (5-Why/Fishbone): “Similar label IDs + no scanner interlock.”
Action plan (who/when): “Install scanner interlock, unique ID schema, operator training—Owners: PE/QA, Due: Oct 5.”
Verification of effectiveness: “0 incidents across 10k units; spot audits weekly x 4 weeks.”
Standardization: Update work instructions, add to internal audit check.

Tie each CAPA back to a pillar so you track systemic improvement—not just firefighting.

How to prepare for a factory audit in Asia (Taiwan/China/SEA)?

Documents & on-site prep

ISO/IATF certificates, org chart, internal audit plan
APQP tracker, PFMEA & Control Plans, process flow, WI/SOP（latest, operator language）
MSA/Gage R&R, calibration logs, gauge inventory for CTQs
REACH/RoHS/IMDS declarations, conflict minerals
AVL/PO clauses, IQC sampling plans, quarantine procedure, nonconformance logs

Language, culture, calendars, local compliance

Bilingual engineer/PM on site（Rightway provides this）
Align around holiday peaks（LNY/Golden Week/peak export weeks）for audit slots and pilot runs

Confirm label/pack/marking rules and market access docs (CE/FCC, material declarations, origin) early

What does an audit day schedule look like?

09:00–09:30 Kickoff, scope, risks, CTQs.
09:30–11:00 Document & data review (certs, audits, KPIs, CAPAs).
11:00–12:30 Line walk (incoming → WIP → lines → test → pack).
13:30–14:30 Interviews (process, QA, maintenance, training).
14:30–15:30 Evidence consolidation, sampling checks, photos.
15:30–16:00 Close-out: findings, must-fix list, CAPA owners/dates, re-audit plan.

How does the Rightway FACTS™ work step-by-step?

Pre-audit desk review (documents)

We start by checking key records before setting foot on site: ISO/IATF certificates, org chart, APQP tracker, PFMEA ↔ Control Plans, MSA/Gage R&R, calibration logs, and incoming quality procedures. This makes the audit targeted and efficient.

On-site assessment (line walk, sampling, interviews)

Our auditors verify how things actually run: walking the line, checking Control Plans at stations, sampling CTQs, confirming traceability, and interviewing operators and engineers. It’s about seeing evidence in practice, not just on paper.

Scoring 0–5 & must-pass gates

Each item is scored 0–5. Critical checkpoints (like PFMEA–Control Plan linkage, Gage R&R, and traceability) are must-pass gates—any score under 3/5 means STOP until corrected. This avoids hidden risks slipping into builds.

CAPA plan & re-audit cadence

Findings convert into a corrective plan with owners and due dates. Thresholds rise as you scale: EVT can accept 3/5 with a closure plan, while by PVT/MP all gates must reach 4–5/5. Re-audits verify fixes and feed directly into inspection priorities.

👉 Unlike generic checklists, Rightway FACTS™ adds quantitative scoring and stop criteria—so you know exactly when to proceed and what to fix before it risks your launch.

Qualify Your Next Factory The Right Way!

Choosing a supplier isn’t just about price—it’s about protecting your launch, your brand, and your investors’ trust. With Rightway, you get more than a checklist:

Local presence in Asia (Taiwan, China, SEA) means faster scheduling, bilingual engineers, and lower travel costs.
Decades of cumulative hands-on experience across 40+ startups ensures you avoid common pitfalls.
Integrated audits + inspections close the loop from system assurance to shipment verification.
Quantified scoring & must-pass gates give you clarity: when to move forward, when to stop, and what to fix.

👉 Whether you’re preparing for EVT, scaling to MP, or re-checking a critical supplier, Rightway helps you save time, cut risk, and launch with confidence.