It costs the company more to produce defects or products that don’t function as there is need for recalls. The impact of defects has the following costs to the company
1. Cost of replacing the product
2. The cost of recalls (Think Toyota recalls)
3. The cost of reputation damage due to unreported defects (you can loses 10 clients for each unsatisfied client)
4. The morale of the employees when dealing with client complaints especially in a company where defects are the usual products