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The Impact of Poor Quality

cost nonconformance platform quality software Jul 10, 2019

Quality is one of the most discussed and least understood subjects in the apparel industry.

In many organizations, quality still equals the state of the product during final inspection, or even when it arrives in their warehouses or stores, or worse, with the customer. In fact, the quality inspection process should start much earlier than that in order to minimize the impact for the brand.

Products with poor quality can have a negative impact for companies in many ways. Not only will it result in reputation damage, but it will also cause delays and extra costs. Phil Crosby used the term “the Cost of Quality” to describe the monetary impact of quality issues and activities. He formulated it this way: Cost of Quality = Prevention Costs + Appraisal Costs + Nonconformance Costs.

What is included in the Price of Nonconformance (PONC)? Among the possibilities are:

• Rework and reprocessing
• Returns
• Warranty costs
• Unplanned service
• Legal fees
• Forecasting errors
• Complaint handling
• Brand reputation damage
• Downtime
• Excess & Obsolete inventory
• Failed product launch
• Logistics costs & air freight

This cost and result of non-conformances can impact the various departments in an organization. And they will have to deal with the consequences. In addition to the loss of reputation, the costs are as high as 15-20% of sales revenue and up to 40% of total operations, according to Gagen MacDonald.


The solution lies in the early stages of the process

By introducing early stage inspections, companies can significantly reduce their chances of quality failure in a later, more costly stage of the product lifecycle. In addition, recording quality failure data can help organizations to make better supplier decisions in the future.

Pivot88’s quality software offers the possibility to do easier and faster inspections in all stages of manufacturing from lab tests, T1-T2, incoming, inline, final and DC, in order to have true 360º visibility on your products’ quality. It will also provide correlation tools, visual scorecards and dashboards with operational, tactical and strategic key performance indicators (KPIs).

In addition, having an effective Quality Management system, skilled inspectors and supervisors with regular trainings, and investment in R&D will also help organization to prevent quality failure at the source.

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