Material Compliance Transparency: How OEM Suppliers Can Win More Business

You’re an Original Equipment Manufacturer (OEM) that supplies parts, often through distributors like ISM, to a range of customers. As such, you already know about the importance of adhering to plastics manufacturing environmental and safety regulations. But while the buck might start with you when it comes to ensuring materials and processes are compliant, it doesn’t stop there. In fact, the customers using your product in their machines, healthcare equipment, vehicles, and more are also required to demonstrate compliance, something they can’t do without your help.

 

In this article, we’ll dive deeper into the current plastics manufacturing regulatory landscape, the essential part you play in the compliance chain, and how you can leverage distributors like ISM to help you win over new business.

OEM Suppliers: Your Role in the Compliance Chain

Let’s start by unraveling the terminology and clarifying your role in larger compliance efforts. After all, these roles can become cyclical, just ask any of our customers who are also our suppliers.

• OEM Supplier – This is you, or any other OEM plastics manufacturer that supplies components via third-party distributors to customers.
• Distributors – This is us (or others like us) who source parts from OEM suppliers and make them available to customers.
• Customers – These “end-customers” are likely other manufacturers (including other OEMs) who use your part inside a product they are putting on the market or in the machines they use to make that product.
• Consumers – These are the customers’ customers. They aren’t responsible for compliance but are part of the mounting pressure to observe it.

The burden of compliance proof typically falls on customers, who are the ones producing products for the market. However, they don’t have direct control over everything they must account for. In some cases, they may need to clearly state what chemicals are present in materials they used for their product (or in the manufacturing of their product). So, what do they do?

They turn to the people that sold them the part. In the case of an OEM supplier that uses a distributor, this would be the latter. Distributors like ISM, who work with OEM suppliers to reach customers, can help you save time and stress by fielding customer questions and facilitating sharing essential documentation. But you still play a key role in making sure we have the required information. Since we are not the original manufacturers of the components in question, all we can say is what you (the OEM supplier) have told us. The more transparent and accessible your documentation, the less we’ll be knocking on your door.

Here is where you may be groaning, because compliance tracking and documentation is time consuming. But the simple truth is, if you aren’t compliant, your customers aren’t compliant, and in the eyes of regulatory bodies like the EU or FDA, compliance only counts if it’s proven. Therefore, end-customers are going to gravitate toward parts made by OEMs that aren’t only compliant, but also make it easy to verify that compliance.

But let’s back up for a second to review the mounting pressures your customers face and what you can do to make yourself more helpful (and more appealing) to end-customers.

Growing Regulatory Requirements: A Look at the Current Landscape

Now let’s review the current regulatory landscape for plastics manufacturing and distribution. Keep in mind that these regulations are constantly evolving. Our best piece of advice here is to make a habit of staying informed.

Concerns Over Chemicals

Recent developments include the growing scrutiny around microplastics and PFAS, otherwise known as “forever chemicals.” Basically, we’ve learned that just because you can’t see something, doesn’t mean it isn’t making itself at home in your drinking water, your atmosphere, and even your body. The EU has been cracking down on these chemicals for quite some time, but the US is catching up with individual states enacting bans and implementing disclosure requirements for PFAS chemicals in everything from packaging to industrial components.

Cross-Border Compliance

Regardless of where these regulations come from, they could affect customers, and by extension you, making cross-border compliance a real concern. REACH (Registration, Evaluation, Authorization, and Restriction of Chemicals) and ROHS (Restriction of Hazardous Substances) in the EU put the onus on importers to verify compliance. In other words, they may not be telling American manufacturers what they need to do, but that doesn’t mean a lack of compliance won’t come back to bite you in the form of lost business.

Cross-border compliance can also apply to domestic manufacturing and distribution, as different states are implementing their own regulations. Take California’s Prop 65, for example, that demands clear labeling of any products, even those not directly sold to consumers, that may contain carcinogenic chemicals.

Industry-Specific Regulations

Depending on your industry (or the industries you sell to), you could face even more stringent regulations. Of course, anyone who works in food and beverage or medical manufacturing is no stranger to the specific requirements passed down by the FDA. Medical-grade plastics, for example, must meet biocompatibility requirements as outlined in FDA Title 21 and ISO 10993. However, industries such as aerospace and automotive are feeling the pressure as well. The End-of-Life Vehicle (ELV) directive, for instance, puts restrictions on how certain heavy metals and hazardous substances can be disposed of.

Consumer Transparency Rules

Then there’s the growing overarching trend of carbon footprint and sustainability reporting as more companies across all industries push to “clean up their act,” so to speak. Consumers themselves have driven some of this pressure, making it known that they want to shop, eat, and drive sustainably. Of course, that makes compliance with environmental regulations both an imperative and a marketing tool. As such, new rules have cropped up requiring companies to put their data where their mouth is by supporting claims about recyclability, biodegradability, and composability with verifiable data.

You can already see the role of the OEM supplier in promoting a compliant and transparent supply chain, but let’s take a closer look at the pressures customers face and how you can help.

What OEM Suppliers Should (and Must) Do

Whether any of us like it or not, being compliant is only half the battle. As your partners in distribution, we’re not here to tell you how to be compliant, but we can help you understand how and why you should prove your compliance and make that proof readily available to those downstream (i.e. distributors and the customers we help serve).

Types of Documentation

Most documentation related to manufacturing compliance will fall under COC (Certificate of Compliance) or DOC (Declaration of Conformity). These are similar but serve subtly different purposes.

A DOC is a self-reported document that states your adherence to certain standards (domestically or internationally). It applies to a specific process, design, or component. It also does not necessarily speak to strict regulations, but rather suggested standards and best practices. In short, it’s you proactively saying, “we are making this component for this use, and as such, we are following these standards.”

On the other hand, a COC speaks more to strict rules and your adherence to them. Sometimes, these can be self-reported, particularly where risks of non-compliance are minimal. However, most of the time you’re going to need a regulating body to certify you and provide you with the COC. For example, any FDA or NSF COCs must be issued by the agencies in question after assessing the compliance of a given material or component.

Of course, these are categories of documentation. You’ll need to check what specific documentation applies to your industry. You’ll also need to consider the potential use cases of your parts and how you can support relevant documentation requirements.

Example: The Chain Reaction of Compliance

A DOC (Declaration of Compliance) for Food Contact Materials (FCM) certifies that certain materials are food-safe according to EU plastics regulations. This documentation is mandatory for any “food contact materials” intended for use in the EU and is generally the responsibility of whichever manufacturer is supplying the component in question.

This is where things can get complicated. Let’s say you make a component that ends up in a food-processing and packaging plant. You are US based, as is the plant. However, the product that plant produces is shipped internationally. You may be several steps removed from direct involvement with EU regulations, but it’s still your responsibility to demonstrate compliance. After all, your components are coming into contact with food that is being sold within the EU.

Other Things Manufacturers Can Do

Naturally, you’ll need whatever documentation is required of you, and we’ve already touched on the fact that you should be prepared to support whatever documentation may be required of customers. But what else can you do to grease the compliance wheels and make your parts more attractive to customers?

• Be proactive about known regulatory concerns. Even if the hammer hasn’t come down yet on certain materials or in certain industries, it helps to track what substances of concern are in your materials and parts.
• Offer datasheets and regulatory documentation in digital formats. Step one is tracking what’s in your materials, components, etc. Step two is making that information readily available, so you spend less time directly fielding questions and hunting for the answers.
• Partner with companies who meet ISO, FDA, and REACH criteria (as applicable). If you source materials or components from other places or rely on distributors to assist with value-add services like clean-room assembly and repackaging, check that they too meet and track compliance standards. Keep the compliance information chain healthy.
• Engage in process validation. Ensure your manufacturing processes are consistent and meet all regulatory standards. First article inspection analyzes first production runs for design, performance, and compliance. Ongoing rigorous testing ensures every subsequent batch meets durability, functionality, and environmental standards. These processes are not a required part of material compliance, but they do help with material compliance in that they establish consistent procedures for meeting compliance standards.
• Consider ISO Certification. ISO (International Organization for Standardization) comes in many varieties, many of which may not apply to you. But some, like ISO 9001 for quality management and ISO 14001 for environmental impact, likely will. ISO certification is not a requirement but utilizing a recognized and independently audited compliance framework like ISO provides additional assurance to your customers.

The Hidden Costs of Compliance

Regulatory compliance works best when everyone is on the same page. That includes you (OEM suppliers), us (distributors), and customers we both serve.

Adequately tracking and documenting information about materials and components requires physical and digital resources. These resources include software platforms for tracking and storing regulatory data; man hours for testing, managing documentation, and performing audits; and monetary costs related to certification renewals.

ISM is Your Partner in Compliance

Not familiar with ISM? We are an ISO 9001 Certified distributor that partners with OEM suppliers like you to get parts in the hands of customers for a wide range of use cases. But more than that, we are partners to these customers in supply chain management, meaning our relationship with them does not end with a given transaction. We help them solve problems, answer questions, and more, including helping them source information to satisfy compliance needs.

Already work with ISM? You can help us better serve customers by making relevant documentation readily available. The more we can answer customer questions regarding your parts, the more time you have for your business’s core competencies. Additionally, this promotes faster turnarounds, fewer bottlenecks, and even fewer missed opportunities.

Remember that if you’re feeling the regulatory strain, customers are too. Take advantage of ISM’s value-added approach to distribution by supporting us with documentation, and together we can build trust and loyalty among current customers while winning more business together.