Supplier Quality

Requirements Manual
Amway North America Operations 2011 Edition
Table of Contents
1.0 Welcome To Amway ........................................................... 1
2.0 Scope ................................................................................. 2
3.0 Communication ................................................................... 2
3.1 Supplier Portal .................................................................................. 2
3.2 Supplier Contact Information ............................................................. 2
3.3 Supplier Analytics ............................................................................. 2
4.0 General Supplier Quality Requirements/Expectations ...... 2
4.1 Quality System Requirements ............................................................2
4.2 Product Requirements .......................................................................3
4.3 Specification Requirements ...............................................................3
4.4 Document Requirements ....................................................................3
4.5 Regulatory Requirements ...................................................................4
4.6 Packaging & Package Security Requirements ....................................7
4.7 Labeling & Lot Traceability Requirements ...........................................7
4.8 Shelf Life and Inventory Control Requirements ....................................7
4.9 Change Control/Request Requirements .............................................7
4.10 Shipping Requirements ....................................................................8
4.11 Communication Requirements ..........................................................8
4.12 Metrics Requirements ..................................................................... 8
5.0 Becoming an Amway Supplier ............................................ 8
6.0 Non-Conforming Product .................................................... 9
6.1 Defective Material Disposition Order .................................................. 9
6.2 Corrective Action/Preventive Action ................................................ 10
7.0 Performance Measures/Metrics ...................................... 11
7.1 Measures ....................................................................................... 11
7.2 Metrics .......................................................................................... 11
8.0 Glossary ........................................................................... 13
9.0 Appendix & References ................................................... 15
9.1 Amways Quality Assurance Key Elements & Descriptions ................ 15
Page
1.0 Welcome to Amway
Amway is one of the worlds largest direct
selling companies. Founded in 1959, and
headquartered in Ada, Michigan, USA, Amway
offers consumer products and business
opportunities in more than 80 countries and
territories worldwide. The company also provides
product development, manufacturing and
logistics services through its Amway Operations
and Alticor Corporate Enterprises divisions.
Amway and its family of companies have more than 14,000 employees globally, and help more than
3 million people own and operate their own independent businesses in more than 80 countries and
territories around the world. Some 450 unique, high-quality products carry the Amway name in the
areas of nutrition, wellness, beauty and home care. Nutrilite supplements and Artistry skin care
and cosmetics are the companys flagship brands. In 2010, Amways parent company, Alticor Inc.,
reported global sales of $9.2 billion.
With facilities in Michigan, California, Washington, Brazil, Mexico, Vietnam,
Europe and China, Amway Operations serves the business-to-business market
with sourcing, quality assurance, product development, manufacturing, and
logistics services through a diverse portfolio of leading wellness, body &
beauty, and home care products. Amway Operations also operates farms in
Lakeview, California and Trout Lake, Washington, as well as international
farms in Mexico and Brazil.
As an existing or potential new supplier to Amway, you play a critical
role in our quality processes. This manual contains information to
assist your company in establishing a successful partnership with us by
identifying our quality requirements and expectations. We value each of
our suppliers as part of our team. Thank you for your support in providing
safe, high-quality products to our customers and consumers.
1
2.0 Scope
The requirements and expectations contained herein are applicable for those distributors and
manufacturers supplying into Amway NA (North America) Operations.
3.0 Communication
We encourage and expect open and active communication with our suppliers. By working together
and establishing open lines of communication, we can achieve our mutual goals.
3.1 Supplier Portal
The supplier portal, located at http://supplier.amway.com, is a dedicated supplier website designed
to provide up-to-date requirements, guidelines and business intelligence reporting for Amway NA
Operations. Throughout this manual, you will see references to the portal, directing you to forms
and links which will provide you with more specific information regarding our requirements. If at any
time you have questions, please contact your Amway Procurement Representative or Supplier Quality
Development (SQD) Representative. An SQD organizational chart is located on the supplier portal
under Business Requirements > Quality > Contacts.
3.2 Supplier Contacts
In order to maintain current contact information for our suppliers, we request you submit to your
Amway SQD Representative and Technical Regulatory Analyst a name, phone number, and email
address for the Primary Quality contact and Technical/Regulatory contact for each applicable
manufacturing site supplying products or materials to Amway NA Operations. Supplier Order/
Sales/Customer Service contact information should be submitted to your Amway Procurement
Representative. If you are unsure of who to contact, please reference the Item Buyer and SQD
contacts in Supplier Analytics, our business intelligence system (under the Item Information tab).
3.3 Supplier Analytics
Supplier performance information is available through Supplier Analytics. Suppliers are expected to
monitor their own performance information and discuss performance data with their Amway Procurement
Representative. Contact your Amway Procurement Representative for access to this system.
4.0 General Supplier Quality Requirements/Expectations
Amway desires to partner with you to provide world class quality products to our consumers. We
expect all suppliers to actively and continuously drive quality improvements that will support the
prevention of non-conforming material. In order for us to assist suppliers in meeting these goals,
we expect you to engage in the process and meet certain requirements and expectations, as
outlined in the pages that follow.
4.1 Quality System Management Requirements
: lcssess and fcllcw an lnternal audlt prcgram.
: ^ssess lnternal quallty systems, whloh at a mlnlmum meet ^mway`s 20 uallty ^ssuranoe Key
Llements (^KL), as referenoed ln the ^ppendlx.'
llease ncte, suppllers oan expeot ^mway tc ocnduot cnslte audlts aoocrdlng tc ^mway`s ^KL, as
referenced under Supplier Quality Assurance Capability Assessments in the Performance Measures/
Metrics section of this manual.
2
' Referenoe the suppller pcrtal fcr addltlcnal requlrements.
4.2 Product Requirements
: lrcvlde prcduots manufaotured frcm statlstloally stable prcoesses,
and which meet product and shipping specifications for Amway NA
0peratlcns.', ''
: ^dhere tc all ^mway N^ 0peratlcns Buslness Requlrements lcoated
at http://supplier.amway.com, including specific shipping, quality,
technical regulatory, accounts payable, engineering, specification,
eBuslness, and prcourement requlrements.'
4.3 Specification Requirements
: lcssess the latest speolfloatlcns frcm ^mway and dlstrlbute thcse speolfloatlcns tc the prcper
departments. Every Purchase Order (PO) contains reference to the proper specification to be
utlllzed. lf the SKU cr the speolfloatlcn revlslcn date cn the l0 ls nct allgned wlth the ^mway
specifications in your possession, or you cannot locate them on the PO, contact your Amway
lrcourement Representatlve. ''
: Lnsure speolfloatlcn range allgnment between ^mway and suppller speolfloatlcns. Ccntaot ycur
Amway Procurement Representative if not in alignment (or if additional information is needed to
ensure allgnment).''
: Referenoe ^mway Ccnfcrmanoe Cheokllsts and applloable standards fcr flnlshed gccds and
ocmpcnents.'
: ^dhere tc agreed upcn standards and speolfloatlcns.''
4.4 Document Requirements
As a global company, we require our suppliers to provide us with certain documents. Specific
document requirements can be found on the supplier portal under Business Requirements >
Technical Regulatory Affairs and Business Requirements > Quality, as well as within Amway
specifications. When providing documentation for raw materials, please include your Trade Name/
Chemical Name as well as the Amway Raw Material number if available.
when prcvldlng dcoumentatlcn fcr flnlshed gccds, please lnolude the ^mway SKU number lf avallable.
4.4a Document Types
1. Provide necessary certificates/documents including, but not limited to, the following:
: uestlcnnalresex. Fcrm 1294
: Statementsex. Statement cf ncnlrradlatlcn
: Certlfloatlcnsex. Certlfloate fcr Melamlne ^bsenoe, 3rd party uallty System ^udlt Certlfloate
: Certlfloatesex. C cf ^, Halal, Kcsher
: lrcoess Dcoumentsex. ll^ls, Manufaoturlng Flcw Charts
4.4b Documentation Compliance
1. In order to remain in compliance with our requirements, certificate updates should be sent
to the appropriate Technical/Regulatory Analyst when certification status changes occur
(reference Business Requirements > Technical Regulatory Affairs > Contacts). Documents are
required to be updated every three years, in accordance with Amways record-keeping practices,
for quality assurance.
2. All suppliers shall provide a copy of their most recent third party audit report, including any findings,
from an accredited 3rd party Registrar or certification body (ISO/RAB, GMA-SAFE, SGS, Silliker, NSF,
TGA, FDA) to records.compliance@amway.com and to their Amway SQD Representative.
3
' Referenoe the suppller pcrtal fcr addltlcnal requlrements.
'' Referenoe ^mway speolfloatlcns fcr addltlcnal requlrements (ocntaot ycur ^mway lrcourement Representatlve fcr the
most current specs).
3. When indicated as a requirement on the Amway specification, hardcopy C of As, C of Cs and
C of Ms are required to accompany every lot shipped to Amway, and should be attached to the
shipping documents. These certificates are also required to be faxed or emailed to the appropriate
Quality Assurance (QA) department prior to shipment. Reference Business Requirements > Quality
> Certificate of Analysis and Business Requirements > Quality > Certificate of Conformance/
Manufacturing for fax numbers, email addresses, and proper formatting.
4. Complete a Supplier Self Assessment Form (located on the Supplier Portal under Business
Requlrements > uallty > Fcrms).'
4.5 Regulatory Requirements
As a global company with products in over 80 countries and territories, we must adhere to the
rules and regulations for each market. Please refer to Amway product and material specifications
for details regarding additional requirements including, but not limited to, the following:
4.5a Nutrition Raw Material and Regulatory Requirements
- FA Feed 5afety Medern|zat|en Act
All products and materials supplied into Amway
NA Operations must meet the regulations and
requirements of the FDA Food Safety Modernization
Act. Suppliers are expected to develop and follow their
cwn Hazard ^nalysls Crltloal Ccntrcl lclnt prcgram.
- Restr|cted and |sa||ewed Ingred|ents
All products and materials supplied into Amway NA
Operations must meet current regulations/requirements for restricted and disallowed ingredients
per Amway specifications. Contact your Amway Procurement Representative if you have
questlcns.',''
- c6MP fer |etary 5u|ements
Distributors and Raw Material Manufacturers who provide raw materials to our Nutrilite division
must comply with Food cGMPs; however, Dietary Supplement cGMP compliance is strongly
recommended. Additional dietary supplement guidance may be found on the Standardized
Information on Dietary Ingredients (SIDI) website: http://www.crnusa.info/SIDI/index.html. As
part of Amways Risk Minimization Program, an Amway Procurement Representative or SQD
Representative may request Technical Regulatory records to support your compliance level.
- Nutr|Cert Pregram
Amway desires to use functional botanicals from organically farmed and socially sustainable
sources. For those sources purchased from suppliers (and not our own certified farms), we have
developed the NutriCert Auditing program. The NutriCert program ensures our global agricultural
suppliers meet Nutrilites triple-bottom-line standards. Nutrilites founder, Carl Rehnborg, set
the bar high for quality farming with his Nutrilite Sustainable Farming System (NSFS) practices.
It was precisely those quality farming practices that led to the development of quality nutrients
and supplements. NutriCert has been founded as the vehicle to ensure Carls legacy. The
guiding principles of our NutriCert standards are based on common NSFS elements familiar to
all sustainable and certified organic farms: Encourage Diversity, Build Soil, Dont Contaminate,
Lnsure Traoeablllty and Bulld a Healthy Scolal Lnvlrcnment.
4
' Referenoe the suppller pcrtal fcr addltlcnal requlrements.
'' Referenoe ^mway speolfloatlcns fcr addltlcnal requlrements (ocntaot ycur ^mway lrcourement Representatlve fcr the
most current specs).
Suppliers of botanical ingredients may be subject to the NutriCert auditing program at the farm
(source) location. Discussions regarding the complete botanical supply chain and the NutriCert
policy, standards and auditing procedures - are the first steps of cooperation with our program.
Farms are scored based upon compliance to NutriCert standards, and are certified accordingly.
NutriCert certification status is integral to Amway Global Procurement sourcing strategies and
considerations. Now, more than ever, trusted botanical suppliers who demonstrate a willingness
to provide organically grown raw materials are of great value.
- Nen-Irrad|at|en Pe||cy
Raw materials or products that have been irradiated or treated with ethylene oxide are prohibited.
The following statement is required on CoAs or on signed company letterhead and must
accompany incoming shipments:
This raw material (including all sub components such as additives or excipients, and the origin
feed stock) has not been subjected to irradiation or ethylene oxide treatment.
- Res|dua| 5e|vents
Suppllers must adhere tc lCH and USl guldellnes fcr resldual sclvents.
: ^mway requlres repcrtlng cf any/all sclvents (lnoludlng water) used ln the prcoesslng cf any flnlshed
Botanical/material that Amway Nutrilite purchases (from origin feed stock to finished material).
: ^mway requlres repcrtlng cf any/all sclvents (lnoludlng water) ln any prcoess step (lnoludlng, but
not limited to: preparation, actual extraction, and clean-up of the material produced).
: Tc desorlbe eaoh prcoess step, ^mway requlres the prcvlslcn cf a lrcoess Flcw Dlagram,
describing all process steps from Feed Stock through Finished Product.
: lrcoess Flcw Dlagrams must be desorlptlve encugh tc lnolude any Resln Teohnclcgy, Chemloal
Stripping, and/or special Clean-Up processes utilized.
: Fcr sclvent dlsolcsures prcvlded, the crder cf llstlng shall be ohrcnclcgloal (by prcoess step), and
must clearly define the full Chain of Custody.
- Nen-6M0 Pe||cy
All ingredients for Amway branded products will be non-GMO or Identity Preserved (IP) with a
recombinant DNA threshold of 0.9% with the exception of flavors, and subcomponents with no
function or presence in the final formula.
Suppliers of ingredients where GMO crops exist will be required to provide chain of custody to
substantiate GMO status.
Definitions and requirements for GMO Free, Identity Preserved (IP), PCR Negative, and GMO
Suspect materials can be found on the supplier portal under Business Requirements > Technical
& Regulatory Affairs > Nutrilite Global GMO Policy.
- 1aan Feed Add|t|ves Regu|at|ens
Materials or products destined for the Japanese market will need to abide by these regulations, and
may be subject to Japan Import Testing (JIT). If prohibited materials are naturally occurring, please
provide documentation. Contact your Amway Procurement Representative or SQD Representative for
specific information, and refer to Amway product specifications for requirement status.
- CIq (Ch|na Imert and quarant|ne)
Materials or products destined for the Chinese market may be subject to CIQ (China Import and
Quarantine). Regulations may include, but are not limited to, the following:
1. Raw materials must meet National Standard requirements or receive pre-approval prior to import.
2. Full disclosure of the manufacturing process, including process flow diagrams, is required.
3. Specific requirements related to resin extraction technology must be met.
5
6
4.5b urab|e 6eeds Regu|atery Requ|rements
- Restr|cted 5ubstances: ReR5/RACR/Pre 65
Materials, products or components for use in electrical/
energy using appliances must meet the current
requlrements fcr RcHS ocmpllanoe. whlle subjeot tc
expanslcn, the ourrent llst cf RcHS lnoludes llmlts fcr lead
(lb), oadmlum (Cd), meroury (Hg), ohrcmlum (Cr), lBBs,
and lBDLs. ln terms cf RL^CH, the materlals, prcduots
or components must be in accordance with Annex XVII
ln terms cf Substanoes cf very Hlgh Ccnoern (SvHC).
Materials, products or components must be compliant with
California Proposition 65 requirements and limits.
- |ectr|ca| 5afety
Where applicable, products and/or components must meet and/or be certified and/or recognized
in accordance with electrical safety standards. This includes the appropriate IEC and/or UL
standards. Appropriate documentation in the form of test reports or certificates from authorized
test houses or certifiers is an expectation.
- |ectremagnet|c Cemat|b|||ty (MC)
Products and/or components must meet the appropriate EMC limits in accordance with current
FCC, IEC, EN, VCCI standards, where applicable. Appropriate documentation in the form of test
reports or certificates from authorized test houses or certifiers is an expectation.
- Mater|a| 5afety
Where applicable, materials, products or components intended for use in drinking water treatment
applications must meet current NSF/ANSI requirements for material safety. Suppliers should
be prepared to disclose material formulation information directly to NSF International Toxicology
Servloes. ^ddltlcnally, prcduots must meet ourrent 1apan MHLw requlrements fcr artloles ln ocntaot
with foods and the EU requirements for materials in contact with foods. Materials, products or
components must be compliant with California Proposition 65 requirements and limits.
4.5c Reme Care Regu|atery Requ|rements
The supplier shall provide documentation, where applicable, such as listing of their material on
lnventcrles/llsts tc lnolude, but nct llmlted tc: TSC^, CLRCL^, S^R^, RL^CH, Dcmestlo Substanoes
List (Canada), and Inventory of Existing Chemical Substances (China).
4.5d Cosmetic/Beauty/Personal Care Regulatory Requirements
The supplier shall provide documentation, where applicable, citing compliance with the US Code of
Federal Regulatlcns, the Lurcpean Ccsmetlos Dlreotlve (76/768/LLC) and the Hyglenlo Standard fcr
Ccsmetlos publlshed by the Mlnlstry cf Health cf the lecple`s Republlo cf Chlna. ^s applloable, state
where the materlal may appear cn a publlshed llst/lnventcry lnoludlng, but nct llmlted tc: RL^CH,
Domestic Substances List (Canada), and Inventory of Existing Chemical Substances (China).
4.5e RACR (Regu|at|en en Reg|strat|en, va|uat|en, Auther|sat|en and
Restr|ct|en ef Chem|ca|s)
Amway routinely ships products and raw materials into the European Union. In 2013, certain
specified materials which are imported into the European Union (above a designated volume) will
be considered reportable under this chemical inventory regulation. The Amway Regulatory Affairs
Department may contact you for more information in regards to the status of your materials and
ocmpllanoe wlth RL^CH requlrements.
4.6 Packaging & Package Security Requirements
lrcvlde prcperly paokaged materlals and prcduots per ^mway speolfloatlcns.', ''
1amer-v|dent Packag|ng Requ|rement
To ensure product integrity and guard against the possibility of adulteration, Amway
requires TAMPER-EVIDENT seals and features on all raw material, chemical, and
component packaging forms.
Examples of Compliance
: CcmpcnentsBcxes prcperly and seourely sealed wlth tape cr glue (nc metal staples)
: Raw Materlals and Chemloals (dry pcwders)Super saoks are tled up, and then
zip-tied. Seal integrity (for paper sacks) is self-evident by its very nature.
: Raw Materlals and Chemloals (llqulds, reslns)Drums and tctes are seoured wlth
bung covers, zip-ties, etc. Pails are fitted with lids having tamper-evident tear tabs (and/or zip-
ties). Tankers and Rail Cars have C-TPAT-compliant safety seals at each opening.
This Amway requirement has been traditionally enforced for all APIs (active pharmaceutical
ingredients), excipients, and NMIs (non-medicinal ingredients), as well as tankers and rail cars
subject to the US Governments C-TPAT program.
Fcr all cther materlal and/cr paokaglng typesthe compliance date for enforcement will be
September 1st, 2011. Non-conforming shipments will be subject to rejection (DMDO) and/or ADR
(Arrival Defect Report) issuance.
4.7 Labeling & Lot Traceability Requirements
Provide properly labeled materials and products per Amway specifications and shipping
requlrements (lnoludlng manufaoturlng trade names fcr raw materlals and ohemloals).', ''
4.8 Shelf Life and Inventory Control Requirements
Amway seeks to provide our consumers products of the highest possible quality. As such, product
age and freshness is an important part of that commitment.
: Materlals reoelved by ^mway wlll have at least 50 cf thelr Shelf Llfe remalnlng at tlme cf reoelpt.
: ln scme sltuatlcns, ^mway may have the ablllty tc qulokly sohedule and prcoess materlals when
remaining Shelf Life is less than 50%. In cases where suppliers cannot meet this guideline to
fulfill open orders, we expect suppliers to gain the Prior Approval of their Item Planner and/
or Item Buyer, and document this agreement on the Suppliers Certificate of Analysis (to avoid
rejection at Incoming Inspection).
: ^mway ourrently has a 75 Shelf Llfe guldellne fcr materlals wlth a flnal destlnatlcn cf lndla.
With the exception of market-specific item specifications, our suppliers cannot possibly know the
final destination of their materials (besides the US). In these cases, Amway Item Planners will
communicate to suppliers, at (or prior to) order placement, these higher Shelf Life needs.
4.9 Change Control/Request Requirements
: Suppllers are requlred tc malntaln and demcnstrate ohange ocntrcl thrcugh dcoumentatlcn,
validation, control, and lot traceability including, but not limited to, the following categories:
1. Changes in sub-suppliers
2. Design/Formulation: Any change in materials used or composition of raw material(s)
3. Processes: Any change to the manufacturing processes or equipment
4. Facilities: Moving to a different facility, or adding lines to or changing lines within a current facility
5. Trade Name or INCI (International Nomenclature of Cosmetic Ingredients) name changes
6. Test Method changes
7
' Referenoe the suppller pcrtal fcr addltlcnal requlrements.
'' Referenoe ^mway speolfloatlcns fcr addltlcnal requlrements (ocntaot ycur ^mway lrcourement Representatlve fcr the
most current specs).
8
: ^ll suoh ohanges shall be ocmmunloated tc ^mway, wlth adequate advanoe nctloe glven tc
allow for any necessary analytical/reliability/market registration/stability/panel testing to be
performed. Please be sensitive that some changes may take up to 2 years to implement.
: wrltten apprcval cf all ohanges (per abcve) must be cbtalned frcm ^mway prlcr tc lmplementatlcn.
Please reference Business Requirements > Quality > Notification of Process Change on the supplier
portal for additional information.
4.10 Shipping Requirements
: Shlp materlals prcduoed at apprcved manufaoturlng faollltles cnly, unless prlcr authcrlzatlcn has been
obtained from your SQD representative to ship from an unapproved manufacturing location. A copy of
the authorization must accompany the Certificate of Analysis for each lot shipped from the unapproved
manufacturing location.
4.11 Communication Requirements
: Malntaln gccd ocmmunloatlcn
: Share best praotloes
: Share data fcr reduoed testlng/lnspeotlcn ocnslderatlcn
: Fcous attentlcn cn audlts and fcllcw up aotlcns
: Fcous cn ocntlnued quallty lmprcvement
: Have effeotlve and tlmely prcoesses ln plaoe tc lmplement ocrreotlve aotlcns and quallty lmprcvements
4.12 Metrics Requirements
: Malntaln a rclllng 12 mcnth Rlght Flrst Tlme (RFT) uallty Ratlng ^verage cf 99 cr hlgher, per
the Performance Metric section of this manual. If the RFT Quality Rating Average is below 99%,
suppliers may be asked to provide short and long-term improvement plans to improve their
performance.
5.0 Becoming an Amway Supplier
Becoming an Amway Supplier is a three step process as illustrated below:
1) 1echne|egy &
Risk Screening
Prospective
Supplier/
Technology
Identified
Sourcing
Decision
Begin
POs
Financial Risk
& Operational
Capability
Assessment
Trials
Training
System Set
Audits
Capability
Data Review
Probationary
Trial Period
Formal
Segmentation
Supplier
Qualification
Initiated
Technology
Assessment/
Sampling
2) Caab|||ty
Assessment
3) Perfermance
Evaluation
9
New suppliers may become qualified and approved for use in our supply chain through the following
3 elements:
: Teohnclcgy and Rlsk Soreenlng
: Capablllty ^ssessment
: lerfcrmanoe Lvaluatlcn
If Amway expresses interest in qualifying you as an approved source, you may be asked to:
: lrcvlde ocmplete ocntaot lnfcrmatlcn fcr the faolllty and prcduot belng quallfled
: lrcvlde oustcmer referenoes ln the ocmmcdlty area cf lnterest
: ^gree tc and slgn an ^mwaylnltlated twcway Ccnfldentlallty Dlsolcsure ^greement (CD^)
: Ccmplete a ocmprehenslve Suppller Self Lvaluatlcn (lcoated cn the Suppller lcrtal under
Business Requirements > Quality > Forms)
: lrcvlde all requested dcoumentatlcn regardlng ycur faolllty and/cr prcduot belng quallfled
: Be cpen tc hcstlng a ocmprehenslve audlt/assessment vlslt where cne cr mcre ^mway representatlves
will evaluate your facility, technology, and quality systems (see sQAC in section 7.2.4)
: lrcvlde oapablllty/statlstloal quallty ocntrcl (SC) data as requested by ^mway representatlves
: Ccmplete the presorlbed tralnlng/cnbcardlng as dlreoted by ycur ^mway representatlves
6.0 Non-Conforming Products and Materials
Our Incoming Quality Assurance labs perform product and material inspections per ANSI/ASQ Z1.4.
Your control plan directed sampling (for Incoming, In-Process, and Finished Good inspections)
should fully align with all significant characteristics listed on the Amway specification, per the
following Acceptable Quality Levels (AQL):
: 0.65 fcr Crltloal NcnCcnfcrmanoes
: 1.0 fcr Majcr NcnCcnfcrmanoes
: 4.0 fcr Mlncr NcnCcnfcrmanoes
Should your product or material fail to pass incoming inspection, we will issue a Defective Material
Disposition Order (DMDO). DMDOs are typically communicated via email from either the Incoming
Quality Assurance group or your Supplier Quality Development (SQD) Representative.
6.1 efect|ve Mater|a| |ses|t|en 0rder (M0)
Amway defines non-conforming product as any Amway purchased product or raw material that fails
to meet specifications and agreed upon standards. All non-conforming products or materials are
identified by a DMDO (Defective Material Disposition Order). The DMDO allows for:
: Ccntrcl cr quarantlne cf ncnocnfcrmlng prcduots and materlals
: lnternal (^mway) and external (Suppller) ocmmunloatlcn cf the ncnocnfcrmanoe
: ^ means tc ensure the flnal agreed upcn dlspcsltlcn ls lmplemented
: Measurlng and traoklng cf quallty hlstcry tc ldentlfy trends and areas fcr lmprcvement
There are four types of DMDOs that can be issued against a supplier:
: Lxternal lnocmlng: lssued fcr prcduots fcund tc be cut cf speolfloatlcn at the tlme cf reoelpt at
our warehouse.
: Lxternal lnlrcoess: lssued fcr prcduots fcund tc be defeotlve cr nct wlthln speolfloatlcns
after they have passed incoming inspection. Amway reserves the right to reject and return any
defective material discovered at any point during or after the manufacturing process, including
entire lots/batches, a percentage of a lot/batch, and/or line fall out.
10
: ^rrlval Defeot Repcrt (^DR): lssued fcr lnbcund shlpments that are nct ln ocmpllanoe wlth ^mway`s
Supplier Shipping, Transportation, Quality, and Packaging Requirements.
: 0S&D (0ver, Shcrt and Damaged): lnltlated by Reoelvlng perscnnel whenever a shlpment ls
received damaged or the actual quantity received does not match the suppliers (and/or carriers)
shipping documents or master shipper/case label quantities.
The following table illustrates the supplier actions required based on DMDO type and disposition.
Please refer to the supplier portal for a guide on reading DMDOs (Business Requirements >
Quality > Nonconforming Products & Materials).
Disposition Request Forms are available on the supplier portal (Business Requirements >
Quality > Forms).
6.2 Cerrect|ve Act|en/Prevent|ve Act|en (CAPA)
A Corrective Action/Preventive Action (CAPA) is a supplier created action plan focused on preventing
a non-conformance from recurring. The CAPA is created in response to a DMDO (Defective Material
Disposition Order) issued to communicate non-conforming material or an ADR (Arrival Defect Report)
issued to communicate shipping, packaging, identification, or paperwork errors that lead to a delay in
material or product receipt. CAPAs are required for all DMDOs, and must include the following steps:
5te 1: Acknew|edge Rece|t and ef|ne IssueThe supplier is expected to acknowledge receipt
of DMDO/ADR communication and CAPA request within 48 hours.
DMDO
Type
Disposition Description Supplier Action
External
Incoming
or External
In-Process
Release Under
Deviation (RUD)
Disposition notice issued for products,
raw materials, or components that
do not meet specifications but are
accepted by Amway as-is because
they have minimum impact.
Complete CAPA
External
Incoming
or External
In-Process
Return to
Vendor (RTV)
Disposition notice issued for rejected
products, raw materials or components
that will be returned to the supplier.
Complete Disposition
Request Form;
Complete CAPA
External
Incoming
or External
In-Process
Scrap Vendor
Expense (SVE)
Disposition notice issued for
rejected products, raw materials, or
components that will be scrapped
at Amway and charged back to the
supplier for payment.
Complete Disposition
Request Form;
Complete CAPA
External
Incoming
or External
In-Process
Rework Vendor
Expense (RVE)
Disposition notice issued for
rejected products, raw materials, or
components that will be reworked
at Amway, but the charges will
be forwarded to the supplier for
payment.
Complete Disposition
Request Form;
Complete CAPA
ADR
N/A - No
Financial
Impact
Ex. Transportation: Supplier called
our core carrier directly Ex. Receiving
Warehouse: Wrong info. on packing
slip Ex. QA: Missing C of A
Complete CAPA
OS&D
Freight or
Supplier Claim
Ex. Stock damaged during transit
Ex. PO Quantity does not match the
sum of the case label quantities.
Ex. PO Quantity and case label
quantities do not match actual count
of product within case.
DamageFrelght
Claim Authorization
uantltyC^l^
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5te 2: Centa|nmentDescribe the containment actions taken. Containment is required prior to
any subsequent shipments and must occur within 48 hours.
5te 3: eterm|ne Reet CauseDesignate what type of fundamental deficiency occurred (manpower,
materials, methods, machine, environment) to cause the material/component defect. Also, identify
the Quality System Escape Point(s) and determine root cause of the Quality System failure.
5te 4: Cerrect|ve Act|enDescribe the action(s) taken to correct the defective material, reduce
the rate of failure, and reduce the rate of escape. The supplier is expected to provide verification
that corrective actions performed are effective in eliminating the non-conformity.
5te 5: Prevent|ve Act|enDescribe the action(s) taken to eliminate the cause(s) of failure and/
or escape. The supplier is expected to provide verification that preventive actions performed are
effective in preventing recurrence.
5te 6: Recegn|ze 1eamBoth the Supplier and Amway will provide names and titles of the
individuals involved in correcting and preventing DMDO/ADR issue(s).
Acknew|edgement ef CAPA request and centa|nment are due w|th|n 48 heurs ef rece|t, and are
required prior to any subsequent shipments. Root Cause determination and a Corrective Action
P|an are due w|th|n ? days ef rece|t ef the CAPA request. A Prevent|ve Act|en P|an, |nc|ud|ng
ver|f|cat|en ef beth cerrect|ve and revent|ve act|en effect|veness, |s due w|th|n 30 days ef |n|t|a|
CAPA request.
A CAPA guide is available on the supplier portal at: Business Requirements>Quality>Forms
7.0 Performance Measures/Metrics
Amway has a team of Supplier Quality Development (SQD) Representatives focused on partnering
with key suppliers to drive mutually beneficial improvements in quality, consistency, and service.
This is accomplished through:
: Clearly deflned speolfloatlcns and quallty expeotatlcns fcr materlals
: Measurement and analysls cf suppller perfcrmanoe agalnst expeotatlcns
: Develcpment cf ocntlnucus lmprcvement plans
: lmplementatlcn cf effeotlve ocrreotlve and preventatlve aotlcn prcoesses
: verlfloatlcn cf oapable quallty ocntrcl systems and prcoesses
7.1 Measures
Our SQD program measures supplier quality performance and continuous improvement as follows:
: uallty cf lnocmlng Shlpments (Rlght Flrst Tlme socre frcm Suppller ^nalytlos Socreoard)
: uallty cf Systems (audlt socre)
: Respcnslveness tc uallty lssues
: Lffeotlveness cf Ccrreotlve and lreventlve ^otlcns
7.2 Metrics
7.2.1 Supplier Scorecard
The Supplier Scorecard measures supplier performance using key supply chain metrics, and is
used to determine whether a long or short term relationship will be sought with the supplier.
Scorecards are available on the supplier portal in the Supplier Analytics section. Contact your
Procurement Representative to set up access, as this section is password protected. For more
detailed information on the elements of the Supplier Scorecard, please review the Supplier
Socreoard Handbcck lcoated cn the suppller pcrtal under Supply Management > lerfcrmanoe
Evaluation. Additional questions should be directed to your Amway Procurement Representative.
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7.2.2 RFT (Right First Time)
The RFT metric measures a suppliers ability to meet agreed-upon specifications and requirements.
Each incoming Purchase Order Line is assigned a score of 100% or 0%. Any Purchase Order Line
assigned a Supplier-related DMDO or ADR will be assigned a score of 0%. Suppliers are expected
to maintain or exceed an overall RFT score of 99%. In addition to CAPA requests for individual
failures, SQD Representatives will require a Supplier Quality Improvement Plan from suppliers with
RFT scores < 99%.
Total PO lines with at least one Supplier Related DMDO or ADR
Total PO lines received
RFT
Score
( )
= 1-
7.2.3 sQAC (Supplier Quality Assurance Capability Assessment)~Ready fer Use end ef 1une 2011
Amway utilizes Supplier Quality Assurance Capability Assessments to
: Help suppllers develcp and lmplement adequate uallty ^ssuranoe Capablllty
: Help ^mway rescuroes assess the rlsk tc ^mway cf uslng materlal frcm a suppller
: lmprcve ^mway deolslcn maklng relatlve tc suppller quallfloatlcn, oertlfloatlcn, and lmprcvement
Amway reviews 20 key elements when performing audits and Supplier Quality Assurance Capability
Assessments. These 20 key elements and their descriptions are included in the Appendix of this
manual. Please reference the Supplier Quality Assurance Capability Assessment tool located under
Business Requirements > Quality.
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8.0 Glossary
ADR
Arrival Defect Report; issued for inbound shipments not in compliance with Amway supplier
shipping, transportation, quality, and packaging requirements.
AQL
Acceptable Quality Levels
cGMP
Current Good Manufacturing Practices
CAPA
Corrective Action Preventive Action
CDA
Confidentiality Disclosure Agreement
CERCLA
Comprehensive Environmental Response, Compensation, and Reliability Act
CIQ
China Import and Quarantine
C of A
Certificate of Analysis; summarizes testing performed on referenced product/material
demonstrating its acceptance against the specifications.
C of C
Certificate of Compliance; a declaration from a non-consumable item supplier stating the
referenced product/material meets all requirements, standards, and/or specifications.
C of M
Certificate of Manufacture; a declaration from a finished good supplier indicating whether any
deviations were made to the process or formula laid out in the specifications.
Corrective Action
Supplier created action plan focused on containing non-conforming material and determining root
cause and immediate resolution of issue.
DMDO
Defective Material Disposition Order; used to identify and communicate non-conforming products or
materials which fail to meet specifications and agreed upon standards.
External Incoming DMDO
Issued for products found out of specification at time of receipt.
External In-Process DMDO
Issued for products found defective or out of specification after passing incoming inspection; may be
discovered at any point during or after the manufacturing process.
GMO
Genetically Modified Organisms
INCI
International Nomenclature of Cosmetic Ingredients
JIT
Japanese Import Testing
OS&D
Over, Short, and Damage; issued by receiving personnel for shipment received damaged or for
quantity discrepancies between the actual quantity received and what is documented on the
shipping papers or master shipper/case labels.
PO
Purchase Order
Preventive Action
Supplier created action plan focused on preventing a non-conformance from reccurring.
QAKE
uallty ^ssuranoe Key Llements
REACH
Regulation on Registration, Evaluation, Authorization and Restriction of Chemicals
RFT
Right First Time
RUD
Release Under Deviation; products/materials that do not meet Amway specifications but are
accepted as-is due to minimum impact.
RTV
Return to Vendor; disposition notice issued for rejected products/materials that will be returned to
the supplier.
RVE
Rework Vendor Expense; disposition notice issued for rejected products/materials that will be
reworked at Amway but charges will be forwarded to the supplier.
Root Cause
Fundamental deficiency that caused the non-conformance to occur
SARA
Superfund Amendments and Reauthorization Act
SIDI
Standardized Information on Dietary Ingredients
SQD
Supplier Quality Development
SVE
Scrap Vendor Expense; disposition notice issued for products/materials that will be scrapped at
Amway and charged back to the supplier for payment.
TSCA
Toxic Substances Control Act
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15
9.0 Appendix & References
9.1 Amway's qua||ty Assurance Key |ements (qAK) & escr|t|ens
1. Leadership
Senior site management must give personal leadership and define the requirements to encourage
a quality culture. Individuals and teams should be judged and rewarded for delivering quality
product on time as well as preventing issues.
2. Training
All facilities are staffed with a sufficient number of trained and qualified personnel to ensure that
quality materials are produced and distributed. The training is job specific and includes the relevant
details of Quality Assurance and Company Policies.
3. Bu||d|ng Fac|||t|es, qu|ment es|gn, Insta||at|en & Ma|ntenance
All buildings and equipment are designed to encourage compliance with good quality procedures. Layouts
provide sufficient space and direct product flow to help prevent mix-ups. Design and construction facilitate
easy cleaning, sanitization, preventive maintenance, accurate process measurement capability, and other
protection from weather, pests, and other sources of contamination.
4. Technical Standards
Specifications and standards form the foundation of any Quality System. Operating limits are set
to ensure compliance with specifications and Regulatory requirements. Once proper limits are set,
they are rigorously followed. Systems are in place to ensure that only up-to-date specifications and
standards are in use.
5. Written Procedures
In order to achieve consistency of product quality, work processes must be reproducible. The key
to achieving this reproducibility is well written and consistently followed procedures. Procedural
change control is managed according to defined and documented procedures.
6. Validation/Verification
Products, methods, processes, software, production systems, procedures, and test methods are
validated where appropriate to ensure they are capable of consistently achieving their desired
results. Where validation is required, there should be a written procedure specifying which process
and procedures required validation and the nature and scale of validation.
?. Reuskee|ng, Pest Centre|, 5an|t|zat|en & Ryg|ene
All potential sources of contamination, whether biological, chemical, or physical, are identified and
controlled. The front line of defense is always good, basic housekeeping and maintenance. Where
products are susceptible to microbial contamination, regular microbiological monitoring is carried out.
8. Material Control
The quality of raw materials, packing materials, and components is important to the final quality
and integrity of products. Starting materials are purchased from approved suppliers according to
approved specifications. In R&D, starting materials are those materials used in laboratory and pilot
plant facilities. Starting materials must be controlled upon receipt, during storage, and in use.
9. Manufacturing Operations
The quality of the making operation largely determines the quality of the final product. Making
operations consistently produce high quality product when they convert approved starting materials
into finished product using properly specified procedures.
10. Packaging Operations
Effective package design and packing line performance establishes adequate product protection
(e.g. damage, identity, contamination, etc.) Lot coding and expiration dating are critical for product
traceability and, in some cases, for meeting legal requirements. Packing operations consistently
produce high quality packages when they convert approved starting materials into finished
packages using properly specified procedures and equipment.
16
11. 5terage & F|n|shed Preduct Rand||ng
Effective handling and distribution operations help ensure high quality product by preventing product
damage due to the environment, improper handling, or excessively long storage periods.
12. Laboratory Control
Professional laboratory operations are critical to the successful control of production. Laboratories
must have adequate facilities, instrumentation, analytical methods, procedures, record keeping,
and qualified personnel to ensure that product quality decisions are based upon sound data.
13. Process Control
Effective Process Design and Control will consistently deliver high quality product at the lowest
pcsslble ocst. Key oharaoterlstlos cf bcth the prcduot and the prcoess must be ocntrclled tc
achieve consistent quality.
14. In-Precess and F|n|shed Preduct Re|ease & Centre|
To ensure that only quality products are delivered to customers, good control is established over
the release of product, shipping practices, inventory control, and returned goods. Robust systems
ensure that products released for shipment meet all finished product specifications. There is a
system for handling deviations. There also is a system for retrieving product in case a serious
problem is identified after a product has been shipped.
15. Records
Thorough documentation is good science, makes good business sense, and for some businesses,
is a legal requirement. Records enable us to investigate complaints, spot trends, make product
improvements, establish a paper trail for research, and maintain the ability to retrieve product should
that ever be necessary. Accuracy and timeliness are critical parameters for a useful records system.
16. Internal Audits
An Internal Audit Program is an effective tool used to ensure the quality of our products and
compliance with corporate and government regulations. A well functioning internal audit program
identifies and corrects in a timely manner any deficiencies present in the sites quality system and
causes permanent systemic solutions to be implemented.
17. Customer Learning & Response
Customer and consumer complaints are a significant source of information concerning the design
and perceived performance of products. It is essential that all information received in the complaint
system is recorded accurately and acted upon promptly. When reported, problems must be
investigated to determine if products not complying with specifications or presenting a risk to
the consumer have been distributed. Complaints can also be an important source of product
improvement ideas.
18. Quality Metrics Tracking & Improvement
Measurement, tracking and improvement of results are a key Total Quality principle. We know how
systems are performing so that priorities and improvement efforts can be established and tracked. Each
operation in R&D and product supply establishes results tracking systems for their key Quality Assurance
systems to paint an accurate picture of the current state and identify needs for improvement.
19. Accountability for Suppliers
Each Amway supplier retains primary responsibility for the quality for any sub-supplier they use. This
Key Llement ls lntended tc be used tc evaluate hcw well crganlzatlcns manage the suppllers fcr
whom they are responsible.
20. Safety & Security
Facility management is expected to communicate requirements for workplace health and safety to its
employees. Adequate and compliant safety training is supplied and documented. Controlled access
to facilities and to sensitive areas is restricted to qualified individuals. Systems need to be in place
to adequately protect materials and prevent product diversion. Processes are necessary to protect
proprietary information and protect the security and reputation of the Amway business.
1028769 2011 Amway Corp 7575 Fulton St E Ada MI 49355