At a typical manufacturer, the cost of poor quality runs to 15–20% of sales. Shellye Archambeau, a Quality Digest contributor, once put a face on that number: A $250 million company added up its repair, rework, scrap, warranty, and write-off costs, and found they equaled 20% of sales. That’s one full day of every five-day week spent making scrap—about $200,000 a day.

Most plants try to shrink that number with more inspection. Problem is, that’s the most expensive way to buy quality; inspection only finds defects after the money to make them has already been spent. If more inspection reliably fixed quality, the problem would have been solved decades ago.

Where the money actually goes

The cost of quality breaks into four buckets.

Prevention: This is the cheap bucket that carries things like training and practice, mistake-proofing a fixture so a part can’t seat backwards, and keeping equipment maintained.

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