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Business

Study Notes

Quality - Introduction

Level:
GCSE, AS
Board:
AQA, Edexcel, OCR, IB

Quality is important to businesses but can be quite hard to define. A good definition of quality is:

"Quality is about meeting the needs and expectations of customers"

Customers want quality that is appropriate to the price that they are prepared to pay and the level of competition in the market.

Key aspects of quality for the customer include:

  • Good design – looks and style
  • Good functionality – it does the job well
  • Reliable – acceptable level of breakdowns or failure
  • Consistency
  • Durable – lasts as long as it should
  • Good after sales service
  • Value for money

'Value for money' is especially important, because in most markets there is room for products of different overall levels of quality, and the customer must be satisfied that the price fairly reflects the quality.

Some products and services are marketed as 'basic', having none of the extra features and benefits of more expensive alternatives. Good examples would be Easyjet and George at Asda clothing ranges. Even though it may be 'low quality' in terms of style or features, these products still give good value for money for their overall level of quality.

For the firm, good design is fundamental, so that the product can be produced efficiently, reliably and at the lowest possible cost.

Quality helps determine a firm's success in a number of ways:

  • Customer loyalty – they return, make repeat purchases and recommend the product or service to others.
  • Strong brand reputation for quality
  • Retailers want to stock the product
  • As the product is perceived to be better value for money, it may command a premium price and will become more price inelastic
  • Fewer returns and replacements lead to reduced costs
  • Attracting and retaining good staff

These points can each help support the marketing function in a business. However, firms have to work hard to maintain and improve their reputation for quality, which can easily be damaged by a news story about a quality failure.

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