The True Cost of Bad Quality
In almost all buying decisions, cost is one of the most important factors in determining which option is best. Most people understand cost as the price they pay on an invoice, but there is sometimes more to the cost of a product than just the selling price. One of those factors that often gets overlooked is the quality of the product. If a part is defective or not usable, then there is a cost associated with that condition. In this piece, we will further dissect the costs of quality and how that affects the customer and supplier relationship.
When it comes to the cost of quality, it is important to first understand what quality really means. Quality is defined as “the standard of something as measured against other things of a similar kind; the degree of excellence of something”. For most manufacturers, this means meeting customer standards and specifications, or simply put making sure the part matches the print. The processes, tools, techniques, and actual measurements to get to this distinction of good or bad can be tricky, but at the end of the day, it either meets the drawing or it doesn’t.
The costs start to build up when we have this condition of parts not meeting the print. Typically, the largest costs incurred relate around inefficiencies and unproductivity of the employees. When a quality issue comes up, the first thing that usually happens is a sort is instituted to separate the good parts from the bad. Sorting is costly because it basically doubles the labor spent to make the part. First, there is the machinist’s wages, and now we add in someone else’s wages to ensure the operators parts are good. In a production setting where the volumes are high, or where the sorting is difficult, the costs of this extra labor can be severe.
The other cost component of sorting is the time. Someone spends their time painstakingly going through each part one by one inspecting to make sure it meets the print. In a lot of cases, this person is taken away from a machine that could be running good parts. So, the company is forced to take time and valuable resources away from the primary functions of machining and instead using that time to go back over a completed process. This is the epitome of unproductivity and inefficiency.
Another cost incurred with these quality issues are the tangible bills that are involved with taking parts back or causing delays on the assembly line. If parts are deemed to not meet the print, the supplier must foot the bill to ship those parts back to their facility. Additionally, many customers will bill the supplier for any time lost in their assembly process due to defective parts.
Having a bad quality product can affect more than just the bottom line. They can lead to negative and strained relationships with the customer, and in some instances, risk losing clients. As the trust in the supplier to supply parts that meet the print wanes with ongoing or consistent quality issues, the relationship between the party’s strains. Customers will be less likely to let them look at other business opportunities and will also force them to look at other sources that may be better at supplying the components. Issues with quality can also cause delivery delays, which puts further tension on the relationship and can create negative images of the supplier overall.
At Ashley Ward, we pride ourselves on our high-quality products. We are an ISO certified company that provides our customers with world class quality. To prove this point, Ashley Ward ranks #1 among 73 suppliers for one of our largest lawn and garden customers. With this being said, we make sure that our parts are constantly being inspected to ensure customer satisfaction, along with timely deliveries, and excellent customer service.
In summation, quality does matter. A bad quality product is much more than a part not meeting a print. Companies need to understand how quality relates to the overall costs of the product because quality relates directly to the bottom line. In order to be successful companies have to make quality their top priority.