Qht1 Task 1

655 Words Sep 19th, 2014 3 Pages
Memo:



As we continue to move toward the end our quarterly objectives. I wanted to take the time to explain some of our costs. In our particular field of designing and manufacturing products, we are always engaging in ways that we can mitigate loss and improve our processes. Performing such changes will give a stronger presence in the market by allowing us to remain competitive.
While we are performing our analysis on different aspects of the company, we look at the three main types of cost. When we remain devoted to improving our costs, and the faults related, we show our same devotion to our consumers. This is portrayed by the quality of products we put on the shelves. Prevention costs, appraisal costs and Failure costs are areas
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We can also see appraisal costs benefits when looking at the QA department and how they monitor the raw materials entering our plant. Every time they prevent poor quality material from making it into our production environment, this is our way of making sure that our clients are receiving the best materials we have to offer. Although there is a cost there for that department, the gains we see from increased sales and customer satisfaction can be partially attributed to them.
Failure costs is cost associated with products or services that are below par. This can be seen in Internal and External costs. Internal costs are those that are discovered while our products are still in production. External costs are those costs associated with failures identified once the products reach our customers. An example of internal costs would be if one of our manufacturing equipment went faulty and caused our products to be made outside of our quality standards. An external failure example would be the cost applicable to us trying to correct a defective product reaching our customers. We most commonly see this with the need to ship a replacement item for our customers that have received a flawed product.

Trade-offs are often seen within the three types of costs listed above. Sometimes we must choose to spend our budget more heavily on appraisal costs so that we can try to…

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