Quality management expert Bruce K. Shibuya discusses why superior quality leads to lower costs for business owners because the total cost of quality increases revenue.
It’s no secret that customers want quality products. However, customers also want affordable products. For many manufacturers, combining the quality and the affordability customers want can seem like an impossible task. Bruce K. Shibuya is a quality management expert with decades of experience working with companies ranging from Microsoft to Toyota.
Bruce K. Shibuya explains that providing superior quality products can actually lead to superior affordability. While many manufacturers may be shaking their heads, Bruce K. Shibuya assures them that research has shown that providing better quality products allows companies to profit more. Shibuya explains this is because many manufacturers are not putting as much emphasis on external failures as they should be.
“A lower quality product has a much higher likelihood of experiencing failure,” Bruce K. Shibuya says. “Companies often forget that these failures result in refunds and returns.”
Bruce K. Shibuya adds that product failure can result in even more costly issues, like lawsuits, loss of business, and an overall negative reputation. He states that these difficulties are much harder to bounce back from than simply creating a quality product you’re proud to sell in the first place. Bruce K. Shibuya explains that creating a top-quality product allows a company to gain the trust of its customers. Hyundai Motors in the USA took decades to regain lost customers after poor quality results led to decline in sales and revenue. This results in overall loyalty and repeat sales.
“Once you have customer loyalty and a big brand following, you instantly have more opportunities to profit,” Bruce K. Shibuya says. “You can even raise your prices when needed without losing your customer base”, because high quality is worth the increase in product prices.
Bruce K. Shibuya adds that while customers want a product that lasts, they also want a product that looks and feels good. A higher-quality product is typically more pleasing to the eye than a low-quality product. Shibuya explains that customers notice the small details that make a product superior to its competition and cutting corners on the production of your product won’t lead to those eye-catching details.
“Research shows, time and time again, the correlation between profitability and quality,” Bruce K. Shibuya says. “Higher quality products lead to a superior return on investment, and manufacturers, as well as their customers, can appreciate that.
Bruce K. Shibuya finishes by reiterating that products with fewer failures lead to lower service costs for the manufacturer. Fewer failures also means less money poured into research on how to prevent such failures.
“Improve the quality of your product today and enjoy larger market shares and increased sales tomorrow,” Bruce K. Shibuya explains.