COURSE INSTRUCTOR:

MR: IRFAN ALI

REPORT TOPIC:
COST OF QUALITY
CLASS: BBA 6G

GROUP MEMBERS
MUHAMMAD TAYYAB (02-111201-083)
MUHAMMAD FAIZAN RIAZ (02-111201-287)
HANZLA FAROOQ (02-111201-092)
MUHAMMAD USMAN ZIA (02-111201-226)
 BRIGHTO PAINTS

ABOUT COMPANY :
Brighto Paints was founded in 1973 and has its headquarters in Lahore. It is proud
to be Pakistan's first multinational paint production company and to supply
Pakistan and other countries with the best paint and coating products. The
Company founded by Mr. Kh. Riaz Ahmed Sikka (late) has been dominating the
market with a wide range of paints for ornamental and industrial application. This
has been made possible by its strong customer focus and inventive spirit. Brighto
Paints has spent the last five decades figuring out how to make the paint industry
sustainable. The organization employs highly skilled technical personnel, including
engineers, M.Sc. experts, and B.Sc. professionals. Brighto Paints (Pvt.) Limited
has received the International Quality Crown and ISO 9001 certifications, which
are absolute proof of its superior quality. Brighto Paints (Pvt.) Limited has
expanded tremendously over the past 35 years and is now referred to as "The Paint
of the 21st Century" in Pakistan. Long-term partnerships are what Brighto Paints
strives for with both internal and external clients. Our goal is to become a
recognised brand on every continent in the world. We work hard to meet the needs
and demands of each individual consumer. In comparison to other items on the
market, our products are superior in terms of quality and complexity.
COST OF QUALITY:

Absolute cost management is necessary in the industry's increasingly difficult

environment, and cost of quality is a crucial metric for measuring business
performance. BRIGHTO PAINTS must take into account the expenses of
obtaining quality since their goal is to satisfy customers' wants (and legal
obligations) while also doing it at the lowest possible cost. This entails
comprehending, measuring, and disclosing the cost of quality, which represents
20% to 30% of an industrial company's sales revenues and contributes significantly
to overall expenses. The overall costs paid by a company to achieve, maintain, and
manage poor quality throughout its line of business with the goal of obtaining the
maximum degree of customer satisfaction are known as the cost of quality. The
cost of high quality is what it takes to ensure that tasks are completed correctly the
first time, including preventative and assessment expenditures. The cost of poor
quality is the money lost when work does not satisfy customer requirements; it is
often quantified by measuring the cost of warranty fees, warranty claims, and
correcting, reworking, and other failure costs.

In order to communicate quality-related operations (hosted by the Quality

department) in the common language of the facility or department, a quality
costing model must be established. Promoting quality as an objective corporate
criterion to affect strategic and business choices is the goal. Another objective is to
increase knowledge of these economic factors among those who are quality-
focused (such as industrial, sales, and service departments).

END-TO-END COST OF QUALITY MANAGEMENT

PROCESS:
BRIGHTO paint follow few steps for cost of quality management process which
are as following:
1) Define the foundation for the Cost of Quality: Determine the needs
of management and the business (what do they want? Which do they
require? Explain the Cost of Quality approach: First goal: Strike a balance
between appraisal and preventative expenses. The second goal is To avoid
slipping into over-quality, keep an eye on the effect that preventative
expenses have on the overall cost of quality. Specify KPIs. Decide what
Cost of Quality information you need to gather. Choose tools for analysis
and visualization of the cost of quality. Create a solid organization.
Define a task force in detail (R&R).
2) Gather the data: standardize and automate data collecting. Adapt the
data gathering frequency.
3) Clean the data: Establish the proper unity. Validate the results of the
analysis. Adjust the statistics in light of reality.
4) Combine the data and visualize: Make sure the information has value.
Give a concise data summary (for executive and business levels).
5) Analyze the data: analyze at all organizational levels, including high
management and the work floor. Converting data into information.
6) Action suggestions: Encourage business and shop floor levels to propose
actions.
7) Influence operational or strategic choices: Incorporate cost of
quality measures into project charters and business scorecards. Budget and
Cost of Quality are connected. Analyze the development of the quality cost
(globally and in detail).
8) Maintain process improvement and take into account overall
outcomes: Take a look at the overall Cost of Quality results. Inform
everyone in the organisation on the Cost of Quality. Review implemented
measures indicating effects on the Cost of Quality model on a regular basis
(from reactive to preventive).
TYPES OF COST OF QUALITY:
There are some few types of quality :
 Cost of internal failure
 Cost of external failure
 Appraisal cost
 Prevention cost

Cost of internal failure:

To fix flaws found prior to the product or service being provided to the client,
internal failure costs are spent. These expenses arise when work products fall
short of design quality expectations and are discovered prior to being given to the
client. They could consist of
Waste: Unnecessary work done or stock held due to mistakes, shoddy planning,
or poor communication.
Defective goods or materials that can't be sold, utilised, or repaired are called
scrap.
Rework or rectification: Fixing flawed products or mistakes.
Failure analysis is a necessary process to identify what went wrong internally with
a product or service.
BRIGHTO PAINTS cost of internal failure are as following:
Brighto paint try to manage their quantity best but there is a no chance in any
industry that they do their operation without any errors. Titanium dioxide, zinc
oxide, and other pigments, solvents such mineral turpentine, resins, and different
additives are only a few of the important raw ingredients used in the manufacture
of paint. Sometimes few mistakes are occur when they use their raw materials for
example they use something that need is 100 kg in making paint but they use
105kg which makes paints solution not in good quality and not on standards. They
cost of this is pay by company. Beacause they try to provide best quality to
customers. Some times many raw material are waste during production and
company bear their cost. There are many reasons for internal failure cost before
delivering products for customers and after the delivering. Brighto paint use
metal boxes for their paints and also use plastics boxes in many size packaging.
Many times boxes are damage during productions and making boxes which cost
also bear by BRIGHTO paint. Many times some issues occurs in their production
lines and in machines which they use for production. Some time they pay cost for
repairing of machines. When their machines are stop their production stop which
gives BRIGHTO huge lose in production. They face difficulty in fulfill their
production schedule.

SCRAP OF METAL PAINT CONTAINERS

According to a survey by ResearchAndMarkets.com, the paints and coatings
industry will expand significantly over the next five years. By the end of 2023, the
market is anticipated to reach USD 223.89 billion, expanding at a CAGR of 4.46%
from 2018 to 2023. A number of causes, including expanding urbanisation,
increased household spending, and accelerating economic growth, are
contributing significantly to this growth. During the projected period, it is also
anticipated that rising demand from the Asia-Pacific region's building sector
would spur expansion. BRIGHTO paints try to achieve this chance and gain more
profits by making best strategies for fullfill their customers or markets demands.

COST OF EXTERNAL FAILURE:

 Product liability
 Claims and returns of goods cost
 Warranty cost etc.
BRIGHTO paints is best paint brand which gives warranty for their products to the
customers if any defects or problem in paint they can return.
The sector continues to confront a number of problems that constitute a
significant risk to the profitability of paint and coatings producers
notwithstanding the favourable prognosis for the industry. BRIGHTO faces
Some of the challenges include continuously rising raw material costs
and stringent environmental regulations due to the presence of volatile
organic compounds (VOCs) in paints and coatings products.
Volatile raw material prices are one of the main problems the paint and
coatings industry is now facing. For makers of paint and coatings, commodity
costs are crucial. This is due to the fact that raw materials account for more
than half of operational expenses. Therefore, it is unavoidable that these
increases in material prices will have a significant effect on the success and
resiliency of paint and coatings businesses. While paint and coatings
businesses have been absorbing the rising cost of raw materials over the past
few years, there is a limit to how much may be absorbed. Therefore, it is not
surprising that many major paint producers have announced price hikes in an
effort to offset some of the rising expenses.