Calculators
Cost of Quality Calculator
Calculate cost of quality across prevention, appraisal, internal failure and external failure, as a share of revenue.
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- Nothing uploaded
The tool
Enter your numbers below. Results update as you type, and nothing leaves your browser.
Everything you enter stays on your own machine. Nothing is sent to us or to anyone else, which you can confirm in your browser network tab.
What people use it for
- Making the case for quality investment
- Quality management reporting
- ISO 9001 management reviews
- Benchmarking quality performance
About this tool
What the Cost of Quality Calculator does
Cost of quality (COQ) groups quality-related costs into four categories. Prevention and appraisal are the cost of good quality; internal and external failures are the cost of poor quality. Investing in prevention usually reduces the much larger failure costs.
Formula
- Cost of good quality = prevention + appraisal
- Cost of poor quality = internal failure + external failure
- COQ % = total ÷ revenue
Worked example
Using the starting values in the calculator above:
| Input | Value |
|---|---|
| Prevention (training, process design, supplier quality) | $60,000 |
| Appraisal (inspection, testing, audits) | $110,000 |
| Internal failure (scrap, rework, downtime) | $180,000 |
| External failure (returns, warranty, complaints) | $140,000 |
| Annual revenue | $9,000,000 |
| Result | Value |
|---|---|
| Total cost of quality | $490,000 |
| As share of revenue | 5.4% |
| Cost of poor quality (failures) | $320,000 |
| Cost of good quality (prevention and appraisal) | $170,000 |
| Failures as share of COQ | 65.3% |
How to read the result
When failure costs dominate, shifting spending to prevention typically lowers total COQ.
External failures also damage reputation and future sales, which these figures understate.
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Questions
Questions about this tool
The things clients actually want to know — costs, timelines, ownership and what happens after launch.
The total cost of preventing, detecting and fixing quality problems.
Prevention, appraisal, internal failure and external failure.
Often cited as 10% to 20% of revenue in many organisations, lower in mature quality systems.
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