Preventive Costs are costs incurred to prevent failures or to reduce appraisal costs

• Training

• Product and Process Design and Improvement

• Validation

• Quality Improvement Planning

• Vendor Approval Process

• Preventive Maintenance

• Quality Data Acquisition and Analysis

Appraisal Costs are costs of inspections, testing and quality evaluation

• Inspection and Testing of Raw and Packaging Materials

• Inspection and Testing of In-Process Materials

• Inspection and Testing of Finished Products

Internal Failure Costs are costs associated with nonconforming material still in the company's possession when activities are not done right the first time

• Out of Specifications (OOS) and Out of Trend (OOT) Results and Deviations

• Rejects

• Reworks

• Re-inspections

• Retests

• Wastage, Scrap, Yield Losses

• Trouble Shooting

• Sorting Substandard Material

• Equipment Downtime

External Failure Costs are costs associated with a non-conformance condition after the product has left the company's ownership.

• Recalls

• Complaints

• Returns due to Quality-Related Problems

• One could add warning letters, consent decrees, and their associated costs