As a manufacturer, keeping customers loyal is the end goal. True value lies in customer satisfaction and a lot of this comes down to manufacturing quality products. Producing high-quality products can become costly, although the pay off depends on the product, quality is worth investing in.
Quality is about meeting or exceeding customer expectations time and time again. The stigma “you get what you pay for” varies depending on the product. Quality manufacturing doesn’t have to mean higher costs. Reducing risks of recall, material wastage and warranty costs can save your business money in the long run.
The term “quality” has a relative meaning. ISO standards have defined it as,“the totality of features and characteristics of a product or service that bear on its ability to satisfy stated or implied needs”.
Manufacturers ensure systems are in place to control quality, this is done in three popular ways;
1. Quality Management (QM)
2. Quality Assurance (QA)
3. Quality Control (QC)
Quality is no longer a question of bottom-line savings but of top-line revenue generation. However, with several options for nearly every product on the market, companies must stay price competitive.
COQ (Cost of Quality) is an important business practice that can monitor the cost to manufacture products to your desired quality. By knowing your quality costs it can help business’s find and correct problems and the costs to attain quality.
COQ is broken down into these categories;
1. Internal Failure Cost
Product defects or failures that are discovered before the product leaves manufacturing. Such defects occur in the production process and would relate to QM (Quality Management).
2. External Failure Cost
These are costs associated with defects found after the customer receives the product. External costs are the most apparent; defective products, recalls, repairs and replacements.
3. Appraisal Costs
These costs relate to inspecting work-in-processes to avoid defects once the product is completed being manufactured.
4. Prevention Costs
These costs are done in the testing stage of product manufacturing and are the most important quality cost investment for a business. By completing this stage, product failure costs are to a minimum
For manufacturers, considering the cost to control the quality of a product is how you will work out whether the product is worth manufacturing. There are plenty of times when paying more for quality equals a better product. There are also times when, clearly, it doesn’t. The correlation between price point and quality is often subjective to the buyer. If you can be transparent with potential buyers on how the price point relates to the manufacturing costs, it could lead to more sales and loyal customers.
