Presentation on theme: "Obj. 2.05 Apply Quality Assurances to Enhance product/service offerings Part I – Grades and Standards."— Presentation transcript:
1 Obj. 2.05Apply Quality Assurances to Enhance product/service offeringsPart I – Grades and Standards
2 What Are Grades and Standards? Grades: Ratings assigned to products that tell to what extent standards were metStandards: Specifications that are used as a basis for comparing or judging goods or services
3 Grades and Standards Why learn about Standards and Grades? How do Standards and Grades affect YOU?
4 Who sets grades and standards? Government agenciesFDA – food and drugsCounty Health Dept. – restaurantsTrade and professional organizations (to promote product safety or provide information)AAA – motelsMovie RatingsBusinessesFord requires suppliers to meet certain standards when making “Q1” parts.
5 Grades and StandardsWhere have you eaten lately?
6 Grades and Standards Inspected Quality How did Grades and Standards affect your food?MilkInspectedEggsQuality
7 Other Examples of How Companies Use Grades and Standards Specific tire sizes to fit our specific cars.McDonald’s requires specific standards so everything is the same in each restaurant around the country. Globally these standards are adjusted for cultural and local standards.
8 Meat Milk Gas Lumber Coal Oil Graded ProductsWhat is graded according to its octane rating?What is graded according to hardwood and softwood?Prime, choice, and select grades refer to what?This is grades for bacteria count, odor, and tasteThis product is assigned numbers according to its thicknessThis product is graded according to its carbon and sulfur contentMeat Milk Gas Lumber Coal Oil
9 Role Play ActivityA restaurant has a surprise visit from a health inspector and the owner and employees have not made any changes to meet the health standards that are required to serve food to the public.Discussion:How can the restaurant make the changes to meet the standards?When the restaurant get a bad grade what will happen publicly?How can the restaurant counter act using marketing strategies?
10 Role Play Activity Discussion: How can the restaurant make the changes to meet the standards?When the restaurant get a bad grade what will happen publicly?How can the restaurant counter act using marketing strategies?
11 Obj. 2.05Apply Quality Assurances to Enhance product/service offeringsPart II – Grades and Standards
12 Grades and Standards How do Businesses use Grades and Standards? Standards are setProducts are rated against standards and assigned a grade
13 Grades and StandardsWhat do businesses do with products that fail to meet lowest standards?Products are disposed of or revamped
14 Speeds things up! Grades and Standards How do Grades and Standards aid in the buying and selling process?Speeds things up!Consumers do not have to inspect. We know what products rank higher than others.
15 Grades and Standards standards important in a Global Market? How are grades andstandards important in aGlobal Market?By using certain requirements,products are known safe to useinternationally.The standard is known as 1S0 9000International Organization for Standardization
16 Grades and StandardsWhat are 4 types of standards that businesses use?1. Quantity- ex. how much will be produced in 1 day2. Quality-ex. no returns or defective products3. Time-ex. how many products can be made per hour4. Cost-ex. how much do the products cost to make
17 Obj. 2.05Apply Quality Assurances to Enhance product/service offeringsPart III – Warranties & Guarantees
18 What is a warranty?Warranty is a defined promise made by the seller to the consumer that the seller will repair or replace a product that does not perform as expected
19 Types of warrantiesDefined as promises expressed in a specific statement concerning the quality of the productCan be written or oralDefined as an unwritten, unstated warranty understood by the consumer and the seller that a product will perform as expectedThe product will do what it is designed and recommended to doExpress WarrantyImplied Warranty
20 Types of warrantiesDefined as warranties that cover the entire productIf the product doesn’t work it must be made good in a reasonable time if not the customer can choose a replacement or refundNo time limits on implied warrantiesThe customer need only notify the warrantor in order to obtain repairsDefined as warranties that do not contain the provisions of full warranties, may cover only certain repairs or specific partsFull WarrantyLimited Warranty
21 What is A guarantee?Defined as a promise made by the seller to the consumer that the seller will refund the consumer’s purchase price if the product doesn’t perform as expected.AKA – “Money-back guarantees”While warranties usually apply to goods, guarantees are given for both goods and services
22 Characteristics of a effective guarantee UnconditionalNo conditions for the customer to meetUnderstandableClear language and no difficulty understanding the promisesEasy for the customer to implementNot a lot of forms, people to see , and different locationsEasy for the customer to collectWhen possible money should be refunded on the spot
23 Purposes of warranties and guarantees To reassure prospective customersTo protect the producer and sellerTo gain repeat customersTo increase salesTo use as a promotional toolTo use as a competitive toolTo use as a image builder
24 Benefits of warranties and guarantees Reduced anxiety about purchasesFree repairsService informationLegal recourseA customer-oriented focusEstablishment of clear standardsFeedback from customersIncreased profitsConsumer BenefitsBusiness Benefits
25 Why are warranties and guarantees regulated and controlled by the law? They can cause problems for producersConsumers misuse the productCustomers expect problems to be fixed that are not under warrantyThere have been times when companies have “guaranteed” their products without living up t the terms of the warranty or guarantee and the customer was cheated.
26 Magnuson-moss warranty act of 1975 This Act provides guidelines for businesses offering warranties and guarantees with their product.Protects consumersMakes warranties stronger & easier for consumers to understandCovers all consumer products & requires marketers to provide product information to consumers even before they make the purchaseFTC has the authority to regulate warranties on products tat sell for more than $15
27 Obj. 2.05Apply Quality Assurances to Enhance product/service offeringsPart IV – Liability and Recalls
28 Product liabilityProduct liability is the area of law in which manufacturers, distributors, suppliers, retailers, and others who make products available to the public are held responsible for the injuries those products cause.3 major types of claims:manufacturing defectdesign defecta failure to warn (also known as marketing defects)
29 Product recallsA product recall is a request to return to the maker a batch or an entire production run of a product, usually due to the discovery of safety issues. The recall is an effort to limit liability (which can cause costly legal penalties and damage in reputation)Recalls are costly to a company because they often entail replacing the recalled product or paying for damage caused by use, although possibly less costly than consequential costs caused by damage to brand name and reduced trust in the manufacturer
30 Product recall agencies US Coast Guard: Marine vehicles and related products (e.g. boats, personal watercraft, life jackets)Consumer Product Safety Commission (CPSC): Consumer products (e.g. toys, household goods, bicycles, off-road vehicles, etc.)Environmental Protection Agency (EPA): Pesticides, fertilizers, and anything harmful to the environmentFederal Aviation Administration (FAA): AircraftFood and Drug Administration (FDA): Food, pharmaceutical drugs, health supplements, cosmetics.United States Department of Agriculture (USDA): Meat, poultry, eggs.National Highway Traffic Safety Administration (NHTSA): On-road vehicles and related products (e.g. cars, trucks, vans, recreational vehicles, motorcycles, tires, motorcycle helmets, children's safety seats)
31 activityUse the Internet to locate information about a recent case involving the Consumer Product Safety Commission (CPSC). Record the following information:Name of the companyNature of the product safety issueOutcome of the caseYou will present your findings to the class