4.2 Quality of goods and services

Quality means that goods and services are…

1. Fit for purpose.
2. Fit with all relevant legal requirements.
3. Do what the customer expects. Providing good quality goods and services can help to reduce wastage from returns and recalls.

Recalls - When a product is faulty so the business takes it back to be repaired or replaced

Providing good quality may also mean that the business gains a good reputation. As a result, customers may recommend the business to others and be more likely to come back in the future, increasing sales and revenue.

Methods of ensuring quality

1. Quality control
2. Quality assurance

Quality control – Quality inspectors checking the standard of a product or service

• Stops low quality goods and services from being sold, this can save a businesses reputation from potentially bad reviews.
• Inspectors are external from the business so there is no bias from workers towards their own products.
• External inspectors may cost a lot. This may be an opportunity cost if workers are able to check for the same faults at no extra cost.

Quality assurance – Workers self-checking the standard of each others work to ensure a product meets the requirements of customers

• Makes workers feel valued and responsible for their product. Higher motivation, more commitment, checks are likely to be more accurate
• No requirement for inspectors who charge a fee, money can be invested in kaizen to improve product quality gradually
• Constant self-checking delays the production process, reduces the output a business can produce.
• Worker checks may not be as thorough as an inspector's, may miss a fault, lower customer satisfaction, weakens brand loyalty.