Pre-shipment inspection
Pre-shipment inspection (also preshipment inspection or PSI) is a part of supply chain management and an important quality control method for checking the quality of goods clients buy from suppliers. PSI helps ensure that production complies with the governing specification, contract, or purchase order. A final random inspection (FRI) checks finished products, often when at least 80% of an order has been produced and export-packed. Samples are selected at random, according to standards and procedures. Process. re-shipment acceptance sampling, involving inspection, and acceptance testing, may be agreed upon between a buyer, a supplier, and  a bank, and it can be used to initiate payment under a letter of credit. A PSI can be performed at different stages before shipment, such as checking the total amount of goods and packing, controlling the quality or consistency of goods, checking of all documentation, as for example test reports, packaging list, or verification of compliance with standards of the destination country like ASME, CE mark and import duties. Defects. There are three levels of defects in a pre-shipment inspection with each defect escalating into the next. Compliance. The inspection team covers the order and shipment. This is  perhaps the most detailed of all the process and is when issues are most likely discovered. This step takes considerable time but importers consider this to be the "de facto" part of the inspection process. Functionality. Does the product work in its intended manner? Important for electronics, toys and the like. Safety. UL, CE, BSI, CSA, FDA, etc are all parts of a safety check. It is of the best interest of the importer to be sure all products meet these requirements, particularly machinery and any product using electricity. Inspection companies. There are two types of PSI companies: A higher  form of the PSI is called expediting, in which the dates of delivery and the production are included in the control. Termination on the PSI requirement. PSI increases burdens and costs in international trade and can be counter-productive for the country of importation and its traders. Several countries are considering termination on the use of inspection companies' service, following upon WTO Agreement on Trade Facilitation Article 10.5 Pre-shipment Inspection : 5.1. Members shall not require the use of pre-shipment inspections in relation to tariff classification and customs valuation. In 1988, United Nations Economic Commission for Europe, Recommendation No.18  - Recommended Measure 8.2 “Discouragement of Pre-Shipment Inspection” was adopted. Particular reasons for pre-inspections from Chinese manufacturers. Many manufacturers in China have reputations that are far from positive. Cutting corners, using sub par raw materials and other methods to raise profits are common. This often works in the manufacturer's favor as the importing country and customer often lacks both the means and labor to return products to China. Refunds can pose to be equally difficult as manufacturers will not return email, refuse to answer phones or feign ignorance of the order. A quality pre-shipment inspection on Chinese  products helps keep these issues to a minimum.