For US importers, finding suppliers these days can be challenging, not only because of COVID-19 travel restrictions. In addition to US government entity list designations, human rights-related restrictions, other trade blacklists targeting Chinese companies have also broken US supply chains.
Called a young company International Compliance Workshop, Or ICW, is determined to make sourcing easier for companies around the world as it has completed a new round of funding. The Hong Kong-based startup has raised just $ 5.75 million as part of its Series A round, raising its total funding to about $ 10 million, co-founder and CEO Gary Lam told TechCrunch.
ICW acts like a matchmaker for suppliers and buyers, but unlike current alternatives such as Alibaba’s B2B platform or international trade shows, ICW also focuses on compliance, product quality, and recognition to suppliers. It collects all of that information in a growing database of over 40,000 suppliers – 80% of whom are currently in China – and recommends them based on individual needs of customers.
Founded in 2016, ICW’s current client base includes some of the world’s largest retailers, including Ralph Lauren, Prenatal Retail Group, Blower, Kmart, and a major US pharmacy chain that did not name.
ICW’s latest funding round was led by Infinity Ventures Partners with a $ 2 billion participation from Integrated Capital and existing investors MindWorks Capital and the Hong Kong Government. Innovation and technology venture fund.
Supply chain shift
Due to the on-going shift of sourcing outside China, the US-China trade war and China’s rising labor costs, ICW has diversified its supply chains to more customers. But infection has limitations in the short term.
“It is still very difficult to find suppliers of certain product categories, for example, Bluetooth devices and power banks, in other countries,” Lam observed. “But for apparel and clothing, the transition was already beginning to take place a decade ago.”
In South East Asia, which is taking a large place of Chinese manufacturing activity, each country has its own specific expertise. Vietnam, where abortions with wooden furniture suppliers, Thailand is known for plastic goods and Malaysia is a good source for medical supplies.
When it comes to complex compliance burdens such as human rights restrictions, ICW relies on third-party certification institutions to screen and verify suppliers.
“There is one [type of] The eligibility standard that verifies that a supplier has met its corporate social obligation … such as factory labor laws, minimum labor rights, or payroll, meets everything, ”Lam explained.
ICW plans to use the fresh proceeds to further develop its products, including its compliance management system, product testing platform and B2B sourcing site.