Introduction to Compliance

What is Compliance?

Compliance essentially covers the act of complying with any rules and regulations that are relevant to the running of your business. For a handmade business, you'll need to be aware of your obligations for GMP ("Good Manufacturing Practice") and for US sellers making certain items, requirements under the CPSC (Consumer Product Safety Commission). For more information on compliance for handmade business, download our free Compliance for Handmade Business eBook.

Assigning Lot Numbers to Material Purchases

A lot number is an identification number assigned to a particular quantity or lot of material from a single manufacturer. This can be either a code provided to you by the vendor of the material, or can be of your own creation. Lot numbers are useful for GMP and CSPC compliance as they can provide traceability between your material purchases and the products you sell.

Lot numbers can be entered whenever a new batch of materials are purchased. This can be done via the Add Expense Item form.

In the example below, the Lot Number for this purchase of a single jar of Coconut Oil is 23432DP:

Each unique lot number you create via the expenses process will be added to a reference list under the Lots tab for each of your materials.

Linking Lots to Manufactures

The lot numbers you have entered into the system can then be assigned to manufactures as you make your products. This is done on the manufacture form for each of your materials allocated to the manufacture.

By linking your manufacture to specific lots, this creates a direct relationship between your purchase and what manufactures it was used in. Continuing the example above, the Coconut Oil material is added to the manufacture for a soap product with the Lot Number of 23432DP to indicate that this particular batch was used in this manufacture:

Assigning manufactures to orders

The last step you need to take for full traceability between material purchase and product is to link your manufacture to the order. To do this, you'll want to navigate to the order page and click on the tab called "Manufactures".

Traceability Reporting

Once you have your lot numbers and manufactures associated, you'll be able to use the Material Traceability Report to create a full traceability summary of material usage. This report will display all expenses, manufactures and orders that have involved a particular lot of a material, allowing you to have the information at your fingertips to initiate a product recall if need be.

As you can see from the report, we can identify very quickly that Kyla Olsen has been shipped a product that was manufactured using the 23432DP lot number of Coconut Oil. In the case of a material defect with the oil, this means you can analyse impact and begin recalls immediately, without taking weeks to comb through your records.

Have some questions?

If you have any additional questions, please get in touch and we'll be happy to give you a hand. Alternatively, feel free to join and post your question in our official Craftybase Facebook group.