Definition of Cost of Quality (COQ):
The cost associated with the quality of a work product.
As defined by Crosby (“Quality Is Free”), COQ has two main components: cost of conformance and cost of non-conformance.
Cost of quality is the amount of money a business loses because its product or service was not done right in the first place. From fixing a warped piece on the assembly line to having to deal with a lawsuit because of a malfunctioning machine or a badly performed service, businesses lose money every day due to poor quality. For most businesses, this can run from 15 to 30 percent of their total costs.« Back to Dictionary Index