customer has to be satisfied that the price reflects the quality
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Importance of Quality
fewer returns = fewer costs
customer loyalty
makes repeat purchases and recommends products to others
retailers and distributers will want to stock your product
strong brand reputation for quality
better value for money = will be bought even when prices change
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Quality
is subjective and a matter of personal opinion
what constitutes an acceptable level will vary from one individual to another
is always evolving
due to improvements in technology, better materials, new manufacturing techniques, and fresh competitors
whilst controlling quality has benefits to a business, it can also be costly to do so. The benefits must outweigh the costs in the long term.
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Measuring Quality
quality is measured in two ways
tangible
intangible
tangible
appearance: function and features
reliability
durability
cost of ownership e.g., repair/maintenance
intangible
image/brand
reputation
exclusiveness
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Cost of Quality
poor quality = additional costs
replacement and refund costs
loss of customers
wasted materials
poor quality includes:
product delivered late
doesn't perform as promised
poor instruction making product difficult to use
product fails
break downs
general wear and tear
unresponsive customer service
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Quality Management
ensures that an organisation, product or service is consistent
Total quality management:
aiming to develop quality culture throughout the business = zero defects
involves all members of staff
right approach 1st time
concentrates on the systems and staff
continuous improvement
you can't have quality control without first having quality management and quality assurance
staff are encouraged to put forward ideas on how to improve the process, this is known as continuous improvement. There will be commitment to quality assurance rather than quality control.
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Quality Assurance
production process
all workers are involved with checking quality of product at each stage of production
makes sure the product reaches the customers standards
aims to prevent faulty products from being produced
faulty products are identified early in the production process. This will reduce waste, in turn saving the company money.
improves workers motivation as they gain recognition
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Quality Control
product orientated
prevents faulty products reaching customers
products checked by inspectors to see if they meet the quality standards set by the company
products not meeting standards of quality will be discarded or sent for rework
rejected product = expensive = materials wasted = very costly
product inspected at the start and end of the production process
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Quality Circles
small groups of workers who come together to discuss and solve problems
employees who are doing the job often have a better idea on how to improve processes
4 key stages:
planning
identify what the business needs to do
analysis
implement quality improvement
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Benefits of Improved Quality
key to competitiveness
similar price but higher quality = likely win
improved image and reputation
higher selling price = higher profits
higher demand = lower costs
fewer complaints
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Benchmarking
the objective of benchmarking is to identify internal opportunities for improvement
is a process of measuring the performance of a company's products, services, or processes against those of another business
benchmarking can be split into 5 key stages
planning phase
analysis phase
integration phase
action phase
maturity phase
best practice in industry and then copy your competitor by adding extra value or unique selling points (USP) to the product
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