Cost of poor quality calculator for UK manufacturers
Cost of poor quality, usually shortened to COPQ, is what it costs you when work is not right first time. Not the cost of inspecting and not the cost of running your quality system. The cost of the failures themselves: material scrapped, hours spent doing jobs twice, machines standing while something is sorted out, parts coming back from customers and the paperwork that follows every one of them.
Most firms know these costs are real and have never added them up, because they sit in five different places and none of them is a line in the accounts. This calculator adds them up and shows you the arithmetic, so you can argue with it.
Your figures
Every box starts empty. There are no pre-filled figures, because a default number is a claim about what is normal in your trade and that is not a claim worth making. Estimates are fine. Round numbers are fine.
Business basics
Turnover is optional. Without it you still get the pound figure, just not the percentage.
Last full year, near enough. Optional.
What an hour of shop-floor time actually costs the business: wage, employer's NI, pension and a share of overhead. Put in a bare hourly wage and every hours-based figure below comes out low.
Internal failure
Problems you catch and put right before the customer sees them.
What you write off in a typical month: material, bought-in parts and the work already put into them. Do not count those hours again in the boxes below.
Time spent putting recoverable work right. The doing, not the paperwork about it.
Hours a week where production stops because of a quality problem: waiting on a decision, a machine held while something is investigated, a job stood down. Not breakdowns, not material shortages.
External failure
Problems that reached the customer.
Anything that came back or was formally rejected, including concessions you had to argue for.
End to end: investigating, replacing or crediting, the phone calls, the report the customer wants. Count it once here, not again under NCRs.
Quality admin
The recording, chasing and closing out. The part that rarely gets costed.
Non-conformance reports, concessions, internal reject notes. Whatever you call them.
Raising it, typing it up, finding the evidence, chasing someone for a cause and an action, closing it out. Not the physical rework, which you have already counted.
Pulling numbers together for management review, KPI reports, customer scorecards and getting records ready for an audit. Not time spent inside individual NCRs.
Produced with the free calculator at toolwright.co.uk/cost-of-poor-quality-calculator.
Figures entered
The working
Every line, with your own numbers in it. If a figure looks wrong, this is where you find out why.
Enter your figures above and the working appears here.
What the calculator assumes
- 46 working weeks a year, not 52. That allows for holidays, bank holidays and shutdowns. It makes the annual figure smaller, which is deliberate.
- Twelve months a year, with the month you described treated as a typical one.
- Hours are priced at the labour rate you entered and nothing else. If you entered a bare wage rather than a fully-loaded rate, every hours-based figure here is understated.
- Downtime is costed as wasted labour only. Not lost sales, not lost margin, not a late-delivery penalty. There is a bigger argument available for what an idle machine costs. This calculator does not make it.
- Scrap is taken as the value you write off, not what it would have sold for. The lost margin on a scrapped part is real and is not counted here.
- Nothing is counted twice. Each box asks for something different: the doing, the paperwork and the reporting are kept apart. If you entered the same hours in two places, the total will be too high.
- Everything is rounded to the nearest £100 and the four categories add up to the total exactly.
What is deliberately left out
- Prevention and appraisal costs: inspection, calibration, training, first-article checks. Those are the cost of doing quality properly, not the cost of getting it wrong.
- Lost customers, lost tenders and reputation. Real and not something anyone can put a defensible number on from a web form.
- Management and director time spent on complaints and escalations.
- Warranty provisions and premium freight to recover a late job.
- Extra stock held because the process is not trusted.
Every one of those pushes the real figure up rather than down. The number this calculator gives you is a floor, not a ceiling.
There is no benchmark on this page. You will find published figures claiming cost of poor quality typically runs at some percentage of turnover. Those have not been verified here, so they are not repeated. Your number is your number and the comparison worth making is against the same calculation done again in six months.
Questions
What counts as cost of poor quality?
The costs you would not have at all if every job went right first time. Conventionally that splits into two. Internal failure is the sort you catch yourself. External failure is the sort the customer catches. This calculator adds a third heading, quality admin, because in a small firm the recording and chasing is often the largest single piece and almost never gets costed.
Does ISO 9001 require me to do this?
No. ISO 9001 does not ask you to put a cost on poor quality. It asks you to record nonconformities, deal with them, act on the causes and keep the evidence. Costing them is your own business decision and it is usually the argument that gets a fix funded.
Is anything I type sent anywhere?
No. This is a single page that runs entirely in your browser. Nothing you type is transmitted, saved to this site, or stored on your device. Close the tab and it is gone. There is no email form and no part of the result held back.
Can I keep a copy?
Use the print button. On a phone or a desktop browser you can choose save as PDF instead of a printer. The printed copy carries your figures, the total, the breakdown, the working and the assumptions, so it stands up on its own in a management review.
Why is my number lower than I expected?
Because the calculator is built to understate. It uses 46 weeks rather than 52, prices downtime as wasted labour rather than lost margin and leaves out the categories listed above. A number you can defend in front of a sceptical finance director is worth more than a big one you cannot.