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Cost of poor quality!!!

Garment Company can save money if there is no quality issue in the products. All cost goes to poor quality. Cost of poor quality explained in another way - the total money factory spends to make the product up to acceptable quality level to customer. But when come poor quality then have to spend money in extra manpower, material, and garments repair. Most of the processes like cutting, printing, stitching, washing may produce defective garments. As result to detect defective pieces, factories install check points (inspection process) in the processes.
Defective pieces need to be screen out from the good pieces through Check point then defective pieces need to repair. Some defective pcs may be damaged and can’t be include those damaged garments in shipment. You have to reject those garments.
Cost of poor quality in a garment manufacturing unit:
Repair works - As additional man hours needed for repair work to complete the shipment – delay in shipment can happen then it turn may cost factory as shipping goods at discount rate or/and factory may need to send shipment by air.
Rejections - Are loss of potential revenue. Also cost of raw materials of those rejected garments.
Inspection - Rechecking garments are also a cost due to poor quality. Quality checkers are employed to check garments. Cost of poor quality is categorized as internal failure cost, external failure cost, prevention cost and appraisal cost.

Steps to calculate COPQ
Step-1: Measure amount of rework and rejection level. Amount of rework can be measured through DHU and Percentage defective. From the DHU value, calculate total number of defects need to be repaired daily (A).
Step-2: Calculate how much time need to remove stitches from a defective garment due to stitching defects (T1)
Step-3: Calculate how much time (average time) operators need to re-stitch the garment (T2). It may vary defect wise.
Step-4: Calculate cost of manpower for repair work. It would equal number manpower involved in rework multiply by their daily wages.

To find rework labor requirement see below way
Number of labor needed for repair (L) = (A * (T1+T2))/480
Here one labor is equivalent to 480 minutes or 8 hours.
Then calculate it into extra wages for excess labor hours used their average salary.
Labor cost in repair = L * Wages per day per labor

Step-5: Excess fabric consumed - To change garment parts, how much extra fabric is issued for re-cutting. Calculate cost of excess fabric (FC).
Step-6: Calculate cost of re-cutting (manpower cost) in case re-cutting/additional cutting is done (CC).
Step-7: Calculate how many garments are rejected (percentage of total pieces of an order). Calculate total loss of potential FOB earning.
Step-8: Find internal failure cost from salary of alteration tailors + Cost of rejected garments + cost of excess material usage (FC) + re-cutting cost (CC)
Step-9: Calculate total COPQ per month = (rework cost + rejection cost+ excess manpower cost+ cost of quality team)
Step-10: Value of total shipments per month
Step-11: Calculate COPQ percentage of total shipment value.

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