Cost Of Poor Quality Calculator

Work out cost of poor quality instantly with clear inputs, formula shown and shareable results.

About Cost Of Poor Quality Calculator

Cost of poor quality is the sum of internal failure costs — scrap and rework — and external failure costs from warranty, recalls and complaints. Expressed as a percentage of revenue it typically runs 5-15% in unimproved operations and under 2% in excellent ones. A high external share signals that detection is failing, not just prevention.

Formula

Cost of poor quality

COPQ = scrap + rework + external failure cost; COPQ % = COPQ x 100 / revenue

Worked example

With the default values below, Cost Of Poor Quality Calculator returns Cost Of Poor Quality of $5,150,000.00. Change any input above and every figure here is recalculated in your browser.

Inputs used

Internal Scrap Costminimum 0: 1,800,000
Rework Costminimum 0: 950,000
External Failure Costminimum 0: 2,400,000
Annual Revenueminimum 0.01: 180,000,000

Results

Cost Of Poor Quality: $5,150,000.00
Internal Failure Cost: $2,750,000.00
COPQ As % Of Revenue: 2.861%
External Share Of COPQ: 46.60%

Step by step

1Values used
2Cost of poor quality
3Cost Of Poor Quality= 5,150,000.00
4Internal Failure Cost= 2,750,000.00
5COPQ As % Of Revenue= 2.861
6External Share Of COPQ= 46.60

Assumptions and limits

The result is derived only from the 4 inputs listed above. Anything not among them is not part of the calculation.
In particular, this calculator does not take inflation or tax into account.
Figures are rounded for display to 3 decimal places, so totals built from several rounded parts can differ slightly from the unrounded arithmetic.

How these calculators are built and tested is described on the Methodology page. If a figure looks wrong, please report it.

Frequently Asked Questions

What is usually missed from COPQ?

Capacity lost to producing scrap, expediting and overtime to recover schedule, extra inventory held to cover yield uncertainty, and engineering time spent firefighting. These hidden costs often exceed the visible ones.

Why does a high external share matter?

Defects reaching customers cost 10-100 times more than the same defect caught internally, and they damage revenue as well as cost. Shifting spend to prevention and detection almost always pays.