External failure costs occur when the company detects and corrects poor-quality goods or services after delivery to customers.

Question

Quizplus · Accepted Answer

External failure costs refer to the costs incurred after the delivery of poor-quality goods or services to customers, which include customer complaints, returns, repairs, and possible lawsuits. These costs can greatly harm the company's reputation and financial performance.

External Failure Costs Occur When the Company Detects and Corrects