Quality (OCR GCSE Business): Revision Note

The concept of quality

• Quality products are those whose characteristics and features satisfy the needs of customers

• Customers may consider products or services to be of good quality if they:

  • Look good and are sold by a reputable business or brand

  • Are reliable and durable

  • Are safe and fit for purpose

  • Receive good customer service, including after-sales service

• Many businesses set quality targets to focus staff and resources on meeting customer expectations:

  • Train operator Southeastern sets punctuality targets for trains

  • Save My Exams sets targets for positive Trustpilot reviews

  • Pizza chain Dominos sets targets for home deliveries completed within 30 minutes of customers placing an order

Methods of ensuring quality

• Within a business, the approach to identifying quality problems falls into one of two categories:

  • Quality control involves inspecting the quality of output at the end of the production process

    • Workers focus on maximising output

    • Products that do not meet standards are rejected before they are released for sale

  • Quality assurance involves inspecting the quality of production throughout the process

    • Workers check their own work and, sometimes, the work of others at various stages of production 

    • Some business take a whole business approach to quality assurance with systems such as quality circles, benchmarking and Total Quality Management (TQM)

Evaluation of approaches to quality management

• Ensuring quality is equally important in the provision of services

  • Mystery shoppers and mystery diners, who pose as real customers, assess the customer service provided and provide detailed feedback to businesses

  • Consumer panels receive product or service samples to use over a period of time, reporting their impressions to a business

The importance of quality

Competitive advantage

• The quality of a businesses products can provide a competitive advantage

  • High levels of quality can be used in promotional activity and provide a unique selling point for businesses in competitive markets

  • Successfully developing a USP for quality can ease expansion into new markets as a result of the positive reputation it creates

  • Increased finance may be available to fund marketing activity to improve brand recognition and attract new customers 

Reputation

• High levels of quality can improve a business's reputation

  • Customers who are satisfied with the quality of products or services are likely to recommend them to others or write positive reviews

    • Those looking to purchase similar products are more likely to spend their money on highly-rated goods or services

    • In some cases, highly-recommended products can be awarded industry-specific recognition

      • E.g. Hotels, restaurants and tourist attractions with positive reviews may be awarded TripAdvisor's Traveller's Choice accreditation

Product recalls and complaints

• Good quality reduces the level of product returns, recalls and complaints

  • Time is not wasted on repairing or replacing items that are unfit for purpose

  • Less money is wasted on providing refunds

  • Staff are less likely to be distracted by dealing with customer complaints

Legal requirements

• In some cases, a certain level of quality is legally required to protect consumers

  • Toys must meet determined safety standards

  • Tools must be equipped with features such as automatic cut-off switches

Pricing

• Quality is closely linked to price

  • High quality products can usually command a high price

  • Lower quality products may need to be sold at a discount to persuade customers to buy them