Quality costs in a fruit processing company: a case study of a Serbian company
Main Article Content
Keywords
fruit processing company, quality costs, quality and food safety
Abstract
Quality costs represent an indicator associated with the achievement or non-achievement of quality. The objective of this study was to evaluate the values and structures of quality costs in a Serbian fruit processing company, to calculate the total quality cost index and analyse allocation of the costs related to quality and food safety. A structured survey in a selected company has been performed in order to collect data. Financial and management system documentation have been reviewed for a period of four years. A prevention-appraisal-failure quality cost model was used in determining, categorizing, processing and analysing the results. In 2008, 2009 and 2010 the quality costs were 49.66, 44.99 and 57.35 €/tonnes, respectively. During the observed period, the structure of costs changed. Prevention and failure costs increased while appraisal costs decreased. The total quality cost index increased from 1.94% in 2008 to 2.58% in year 2010. Results confirmed that the total quality cost index were within the published range of values for the food industry. The distribution of costs changes due to various factors such as additional legal and customer requirements related to food safety and quality, economic crisis and maturity of implemented management systems.
References
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Alldrick, A.J., Van Egmond, H.P. and Solfrizzo, M., 2009. Mycotoxins: food safety management implications. Quality Assurance and Safety of Crops & Foods 1: 153-159.
Alsaleh, N.A., 2007. Application of quality tools by the Saudi food industry. The TQM Magazine 19: 150-161.
Arauz, R. and Suzuki, H., 2004. ISO 9000 performance in Japanese industries. Total Quality Management & Business Excellence 15: 3-33.
American Society for Quality Control (ASQC), 1967. Quality costs, what and how? ASQC Quality Press, Milwaukee, WI, USA.
Bai, L., Ma, C.L., Yang, Y.S., Zhao, S.K. and Gong, S.L., 2007. Implementation of HACCP system in China: a survey of food enterprises involved. Food Control 18: 1108-1112.
Barad, M., 1995. Some cultural/geographical styles in quality strategies and quality costs (P.R. China versus Australia). International Journal of Production Economics 41: 81-92.
Bartolini, F. and Viaggi, D., 2010. Recent developments in multi-criteria evaluation of regulations. Quality Assurance and Safety of Crops & Foods 2: 182-196.
Beheshti, H.M. and Lollar, J.G., 2003. An empirical study of USSMEs using TQM. Total Quality Management & Business Excellence 14: 839-847.
British Standards Institution (BSI), 1990. BSI BS 6143-2 Guide to the economics of quality. Part 2: prevention, appraisal and failure model. BSI, London, UK.
Campanella, J. (ed.), 1990. Principles of quality costs. ASQC Quality Press, Milwaukee, WI, USA, 150 pp.
Celaya, C., Zabala, S.M., Pérez, P., Medina, G., Mañas, J., Fouz, J., Alonso, R., Antón, A. and Agundo, N., 2007. The HACCP system implementation in small businesses of Madrid’s community. Food Control 18: 1314-1321.
Codex Alimentarius Commission (CAC), 2003. CAC/RCP 1-1969, Rev.4-2003 Recommended international code of practice – General principles of food hygiene. CAC, Rome, Italy.
Colatore, C. and Caswell, J.A., 2000. The costs of HACCP. Implementation in the seafood industry: a case study of breaded fish. In: Unnevehr, L.J. (ed.) The economics of HACCP: costs and benefits. Eagan Press, St. Paul, MN, USA.
Department of Defense (DoD), 1963. MIL-Q-9858A Quality program requirements. DoD, Arlington County, VA, USA.
Djekic, I., Tomasevic, I. and Radovanovic, R., 2011. Quality and food safety issues revealed in certified food companies in three Western Balkans countries. Food Control 22: 1736-1741.
Doménech, E., Amorós, J.A., Pérez-Gonzalvo, M. and Escriche, I., 2011. Implementation and effectiveness of the HACCP and pre-requisites in food establishments. Food Control 22: 1419-1423.
European Community (EC), 2002. Regulation (EC) No 178/2002 of the European Parliament and the Council of 28 January 2002 laying down the general principles and requirements of food law, establishing the European Food Safety Authority and laying down procedures in matters of food safety. Official Journal of the European Communities L31: 1-24.
European Council (EC), 2012. Conclusions 1/2 March 2012. Available at: http://www.consilium.europa.eu/uedocs/cms_data/docs/pressdata/en/ec/128520.pdf.
Everett, E.A., Lawrence, M.C., Benito, E.F., Norma, J.H., Lee, T.S., Boo-Ho, R., Jaime, R., Danny, S. and Roy, W., 1997. An international study of quality improvement approach and firm performance. International Journal of Operations & Production Management 17: 842-877.
Feigenbaum, A.V., 1956. Total quality control. Harvard Business Review 34: 93-101.
Feigenbaum, A.V. (ed.), 1961. Total quality control. McGraw-Hill, New York, NY, USA.
Fotopoulos, C.V., Psomas, E.L. and Vouzas, F.K., 2010. Investigating total quality management practice’s inter-relationships in ISO 9001:2000 certified organisations. Total Quality Management & Business Excellence 21: 503-515.
Gall, K., 2000. National seafood industry HACCP implementation survey report. New York sea grant technical report, Stony Brook, NY, USA. Available at: http://www.seagrant.sunysb.edu/seafood/pdfs/HACCP2000Report.pdf.
Giakatis, G., Enkawa, T. and Washitani, K., 2001. Hidden quality costs and the distinction between quality cost and quality loss. Total Quality Management 12: 179-190.
Henson, S., Holt, G. and Northen, J., 2000. Costs and benefits of implementing HACCP in the UK dairy processing sector. Economics of HACCP: costs and benefits. American Association of Cereal Chemists Inc, St. Paul, MN, USA, pp. 347-364.
International Organization for Standardization (ISO), 2000. ISO 10725:2000 Acceptance sampling plans and procedures for the inspection of bulk materials. ISO, Geneva, Switzerland.
International Organization for Standardization (ISO), 2005a. ISO 3951-1:2005 Sampling procedures for inspection by variables – Part 1: specification for single sampling plans indexed by acceptance quality limit (AQL) for lot-by-lot inspection for a single quality characteristic and a single AQL. ISO, Geneva, Switzerland.
International Organization for Standardization (ISO), 2005b. ISO 9000:2005 Quality management systems – Fundamentals and vocabulary. ISO, Geneva, Switzerland.
International Organization for Standardization (ISO), 2005c. ISO 22000:2005 Food safety management systems – Requirements for any organization in the food chain. ISO, Geneva, Switzerland.
International Organization for Standardization (ISO), 2006a. ISO 2859-10:2006 Sampling procedures for inspection by attributes – Part 10: Introduction to the ISO 2859 series of standards for sampling for inspection by attributes. ISO, Geneva, Switzerland.
International Organization for Standardization (ISO), 2006b. ISO 10014:2006 Quality management – Guidelines for realizing financial and economic benefits. ISO, Geneva, Switzerland.
International Organization for Standardization (ISO), 2011. The ISO survey of certifications 2011. ISO, Geneva, Switzerland.
Jin, S., Zhou, J. and Ye, J., 2008. Adoption of HACCP system in the Chinese food industry: a comparative analysis. Food Control 19: 823-828.
Juran, J.M., 1951. Quality control handbook. McGraw-Hill, New York, NY, USA.
Juran, J.M., 1998. Juran’s quality handbook. McGraw-Hill Professional, New York, NY, USA.
Krieger, S., Schiefer, G. and Da Silva, C.A., 2007. Costs and benefits in food quality systems: concepts and a multi-criteria evaluation approach. Agricultural Management, Marketing and Finance Service working document 22. Food and Agriculture Organization, Rome, Italy.
Kulkarni, S.S., 2008a. Loss-based quality costs and inventory planning: general models and insights. European Journal of Operational Research 188: 428-449.
Kulkarni, S.S., 2008b. On a multi-product model of lot-sizing with quality costs. International Journal of Production Economics 112: 1002-1010.
Lagrosen, Y. and Lagrosen, S., 2005. The effects of quality management – a survey of Swedish quality professionals. International Journal of Operations & Production Management 25: 940-952.
Liang-Hsuan, C. and Ming-Chu, W., 2002. Using fuzzy approaches to evaluate quality improvement alternative based on quality costs. International Journal of Quality & Reliability Management 19: 122-136.
Lupin, H.M., Parin, M.A. and Zugarramurdi, A., 2010. HACCP economics in fish processing plants. Food Control 21: 1143-1149.
Maldonado, E.S., Henson, S.J., Caswell, J.A., Leos, L.A., Martinez, P.A., Aranda, G. and Cadena, J.A., 2005. Cost-benefit analysis of HACCP implementation in the Mexican meat industry. Food Control 16: 375-381.
Masser, W.J., 1957. The quality manager and quality costs. Industrial Quality Control 15: 5-8.
Mukhopadhyay, A.R., 2004. Estimation of cost of quality in an Indian textile industry for reducing cost of non-conformance. Total Quality Management & Business Excellence 15: 229-234.
Omurgonulsen, M., 2009. A research on the measurement of quality costs in the Turkish food manufacturing industry. Total Quality Management & Business Excellence 20: 547-562.
Psomas, E.L. and Fotopoulos, C.V., 2010. Total quality management practices and results in food companies. International Journal of Productivity and Performance Management 59: 668-687.
Raspor, P., 2008. Total food chain safety: how good practices can contribute? Trends in Food Science & Technology 19: 405-412.
Raad Voor Accreditatie (RvA), 2005. Guidelines for certification bodies performing certification of HACCP based food safety management systems. Dutch Accreditation Council, Utrecht, the Netherland.
Saita, M., 1991. Economia della qualitá. Strategia e costi (1st Ed.). ISEDI, Turin, Italy.
Seog Ju, C., Hyun, Y. and Park, E.H., 1996. Quality costs in multi-stage manufacturing systems. Computers & Industrial Engineering 31: 115-118.
Serbian Chamber of Commerce Belgrade, 2012. Register of certified companies. Serbian Chamber of Commerce Belgrade, Belgrade, Serbia.
Sousa, S.D., Aspinwall, E., Sampaio, P.A. and Rodrigues, A.G., 2005. Performance measures and quality tools in Portuguese small and medium enterprises: survey results. Total Quality Management & Business Excellence 16: 277-307.
Sperber, W.H., 1998. Auditing and verification of food safety and HACCP. Food Control 9: 157-162.
Statistical Office of the Republic of Serbia, 2011. Statistical yearbook of the Republic of Serbia. Statistical Office of the Republic of Serbia, Belgrade, Serbia.
Tarí, J.J. and Sabater, V., 2004. Quality tools and techniques: are they necessary for quality management? International Journal of Production Economics 92: 267-280.
Taylor, E. and Kane, K., 2005. Reducing the burden of HACCP on SMEs. Food Control 16: 833-839.
Tomaševi?, I., Šmigi?, N., ?eki?, I., Zari?, V., Tomi?, N. and Rajkovi?, A., 2013. Serbian meat industry: a survey on food safety management systems implementation. Food Control 32: 25-30.
Traill, W.B. and Koenig, A., 2010. Economic assessment of food safety standards: costs and benefits of alternative approaches. Food Control 21: 1611-1619.
Tsekouras, K., Dimara, E. and Skuras, D., 2002. Adoption of a quality assurance scheme and its effect on firm performance: a study of Greek firms implementing ISO 9000. Total Quality Management 13: 827-841.
Van der Spiegel, M., Luning, P.A., De Boer, W.J., Ziggers, G.W. and Jongen, W.M.F., 2006. Measuring effectiveness of food quality management in the bakery sector. Total Quality Management & Business Excellence 17: 691-708.
Van der Spiegel, M., Luning, P.A., Ziggers, G.W. and Jongen, W.M.F., 2003. Towards a conceptual model to measure effectiveness of food quality systems. Trends in Food Science & Technology 14: 424-431.
Wallace, C. and Williams, T., 2001. Pre-requisites: a help or a hindrance to HACCP? Food Control 12: 235-240.
Yang, C.C., 2008. Improving the definition and quantification of quality costs. Total Quality Management & Business Excellence 19: 175-191.
Zugarramurdi, A., Parin, M.A., Gadaleta, L. and Lupin, H.M., 2007. A quality cost model for food processing plants. Journal of Food Engineering 83: 414-421.
Alldrick, A.J., Van Egmond, H.P. and Solfrizzo, M., 2009. Mycotoxins: food safety management implications. Quality Assurance and Safety of Crops & Foods 1: 153-159.
Alsaleh, N.A., 2007. Application of quality tools by the Saudi food industry. The TQM Magazine 19: 150-161.
Arauz, R. and Suzuki, H., 2004. ISO 9000 performance in Japanese industries. Total Quality Management & Business Excellence 15: 3-33.
American Society for Quality Control (ASQC), 1967. Quality costs, what and how? ASQC Quality Press, Milwaukee, WI, USA.
Bai, L., Ma, C.L., Yang, Y.S., Zhao, S.K. and Gong, S.L., 2007. Implementation of HACCP system in China: a survey of food enterprises involved. Food Control 18: 1108-1112.
Barad, M., 1995. Some cultural/geographical styles in quality strategies and quality costs (P.R. China versus Australia). International Journal of Production Economics 41: 81-92.
Bartolini, F. and Viaggi, D., 2010. Recent developments in multi-criteria evaluation of regulations. Quality Assurance and Safety of Crops & Foods 2: 182-196.
Beheshti, H.M. and Lollar, J.G., 2003. An empirical study of USSMEs using TQM. Total Quality Management & Business Excellence 14: 839-847.
British Standards Institution (BSI), 1990. BSI BS 6143-2 Guide to the economics of quality. Part 2: prevention, appraisal and failure model. BSI, London, UK.
Campanella, J. (ed.), 1990. Principles of quality costs. ASQC Quality Press, Milwaukee, WI, USA, 150 pp.
Celaya, C., Zabala, S.M., Pérez, P., Medina, G., Mañas, J., Fouz, J., Alonso, R., Antón, A. and Agundo, N., 2007. The HACCP system implementation in small businesses of Madrid’s community. Food Control 18: 1314-1321.
Codex Alimentarius Commission (CAC), 2003. CAC/RCP 1-1969, Rev.4-2003 Recommended international code of practice – General principles of food hygiene. CAC, Rome, Italy.
Colatore, C. and Caswell, J.A., 2000. The costs of HACCP. Implementation in the seafood industry: a case study of breaded fish. In: Unnevehr, L.J. (ed.) The economics of HACCP: costs and benefits. Eagan Press, St. Paul, MN, USA.
Department of Defense (DoD), 1963. MIL-Q-9858A Quality program requirements. DoD, Arlington County, VA, USA.
Djekic, I., Tomasevic, I. and Radovanovic, R., 2011. Quality and food safety issues revealed in certified food companies in three Western Balkans countries. Food Control 22: 1736-1741.
Doménech, E., Amorós, J.A., Pérez-Gonzalvo, M. and Escriche, I., 2011. Implementation and effectiveness of the HACCP and pre-requisites in food establishments. Food Control 22: 1419-1423.
European Community (EC), 2002. Regulation (EC) No 178/2002 of the European Parliament and the Council of 28 January 2002 laying down the general principles and requirements of food law, establishing the European Food Safety Authority and laying down procedures in matters of food safety. Official Journal of the European Communities L31: 1-24.
European Council (EC), 2012. Conclusions 1/2 March 2012. Available at: http://www.consilium.europa.eu/uedocs/cms_data/docs/pressdata/en/ec/128520.pdf.
Everett, E.A., Lawrence, M.C., Benito, E.F., Norma, J.H., Lee, T.S., Boo-Ho, R., Jaime, R., Danny, S. and Roy, W., 1997. An international study of quality improvement approach and firm performance. International Journal of Operations & Production Management 17: 842-877.
Feigenbaum, A.V., 1956. Total quality control. Harvard Business Review 34: 93-101.
Feigenbaum, A.V. (ed.), 1961. Total quality control. McGraw-Hill, New York, NY, USA.
Fotopoulos, C.V., Psomas, E.L. and Vouzas, F.K., 2010. Investigating total quality management practice’s inter-relationships in ISO 9001:2000 certified organisations. Total Quality Management & Business Excellence 21: 503-515.
Gall, K., 2000. National seafood industry HACCP implementation survey report. New York sea grant technical report, Stony Brook, NY, USA. Available at: http://www.seagrant.sunysb.edu/seafood/pdfs/HACCP2000Report.pdf.
Giakatis, G., Enkawa, T. and Washitani, K., 2001. Hidden quality costs and the distinction between quality cost and quality loss. Total Quality Management 12: 179-190.
Henson, S., Holt, G. and Northen, J., 2000. Costs and benefits of implementing HACCP in the UK dairy processing sector. Economics of HACCP: costs and benefits. American Association of Cereal Chemists Inc, St. Paul, MN, USA, pp. 347-364.
International Organization for Standardization (ISO), 2000. ISO 10725:2000 Acceptance sampling plans and procedures for the inspection of bulk materials. ISO, Geneva, Switzerland.
International Organization for Standardization (ISO), 2005a. ISO 3951-1:2005 Sampling procedures for inspection by variables – Part 1: specification for single sampling plans indexed by acceptance quality limit (AQL) for lot-by-lot inspection for a single quality characteristic and a single AQL. ISO, Geneva, Switzerland.
International Organization for Standardization (ISO), 2005b. ISO 9000:2005 Quality management systems – Fundamentals and vocabulary. ISO, Geneva, Switzerland.
International Organization for Standardization (ISO), 2005c. ISO 22000:2005 Food safety management systems – Requirements for any organization in the food chain. ISO, Geneva, Switzerland.
International Organization for Standardization (ISO), 2006a. ISO 2859-10:2006 Sampling procedures for inspection by attributes – Part 10: Introduction to the ISO 2859 series of standards for sampling for inspection by attributes. ISO, Geneva, Switzerland.
International Organization for Standardization (ISO), 2006b. ISO 10014:2006 Quality management – Guidelines for realizing financial and economic benefits. ISO, Geneva, Switzerland.
International Organization for Standardization (ISO), 2011. The ISO survey of certifications 2011. ISO, Geneva, Switzerland.
Jin, S., Zhou, J. and Ye, J., 2008. Adoption of HACCP system in the Chinese food industry: a comparative analysis. Food Control 19: 823-828.
Juran, J.M., 1951. Quality control handbook. McGraw-Hill, New York, NY, USA.
Juran, J.M., 1998. Juran’s quality handbook. McGraw-Hill Professional, New York, NY, USA.
Krieger, S., Schiefer, G. and Da Silva, C.A., 2007. Costs and benefits in food quality systems: concepts and a multi-criteria evaluation approach. Agricultural Management, Marketing and Finance Service working document 22. Food and Agriculture Organization, Rome, Italy.
Kulkarni, S.S., 2008a. Loss-based quality costs and inventory planning: general models and insights. European Journal of Operational Research 188: 428-449.
Kulkarni, S.S., 2008b. On a multi-product model of lot-sizing with quality costs. International Journal of Production Economics 112: 1002-1010.
Lagrosen, Y. and Lagrosen, S., 2005. The effects of quality management – a survey of Swedish quality professionals. International Journal of Operations & Production Management 25: 940-952.
Liang-Hsuan, C. and Ming-Chu, W., 2002. Using fuzzy approaches to evaluate quality improvement alternative based on quality costs. International Journal of Quality & Reliability Management 19: 122-136.
Lupin, H.M., Parin, M.A. and Zugarramurdi, A., 2010. HACCP economics in fish processing plants. Food Control 21: 1143-1149.
Maldonado, E.S., Henson, S.J., Caswell, J.A., Leos, L.A., Martinez, P.A., Aranda, G. and Cadena, J.A., 2005. Cost-benefit analysis of HACCP implementation in the Mexican meat industry. Food Control 16: 375-381.
Masser, W.J., 1957. The quality manager and quality costs. Industrial Quality Control 15: 5-8.
Mukhopadhyay, A.R., 2004. Estimation of cost of quality in an Indian textile industry for reducing cost of non-conformance. Total Quality Management & Business Excellence 15: 229-234.
Omurgonulsen, M., 2009. A research on the measurement of quality costs in the Turkish food manufacturing industry. Total Quality Management & Business Excellence 20: 547-562.
Psomas, E.L. and Fotopoulos, C.V., 2010. Total quality management practices and results in food companies. International Journal of Productivity and Performance Management 59: 668-687.
Raspor, P., 2008. Total food chain safety: how good practices can contribute? Trends in Food Science & Technology 19: 405-412.
Raad Voor Accreditatie (RvA), 2005. Guidelines for certification bodies performing certification of HACCP based food safety management systems. Dutch Accreditation Council, Utrecht, the Netherland.
Saita, M., 1991. Economia della qualitá. Strategia e costi (1st Ed.). ISEDI, Turin, Italy.
Seog Ju, C., Hyun, Y. and Park, E.H., 1996. Quality costs in multi-stage manufacturing systems. Computers & Industrial Engineering 31: 115-118.
Serbian Chamber of Commerce Belgrade, 2012. Register of certified companies. Serbian Chamber of Commerce Belgrade, Belgrade, Serbia.
Sousa, S.D., Aspinwall, E., Sampaio, P.A. and Rodrigues, A.G., 2005. Performance measures and quality tools in Portuguese small and medium enterprises: survey results. Total Quality Management & Business Excellence 16: 277-307.
Sperber, W.H., 1998. Auditing and verification of food safety and HACCP. Food Control 9: 157-162.
Statistical Office of the Republic of Serbia, 2011. Statistical yearbook of the Republic of Serbia. Statistical Office of the Republic of Serbia, Belgrade, Serbia.
Tarí, J.J. and Sabater, V., 2004. Quality tools and techniques: are they necessary for quality management? International Journal of Production Economics 92: 267-280.
Taylor, E. and Kane, K., 2005. Reducing the burden of HACCP on SMEs. Food Control 16: 833-839.
Tomaševi?, I., Šmigi?, N., ?eki?, I., Zari?, V., Tomi?, N. and Rajkovi?, A., 2013. Serbian meat industry: a survey on food safety management systems implementation. Food Control 32: 25-30.
Traill, W.B. and Koenig, A., 2010. Economic assessment of food safety standards: costs and benefits of alternative approaches. Food Control 21: 1611-1619.
Tsekouras, K., Dimara, E. and Skuras, D., 2002. Adoption of a quality assurance scheme and its effect on firm performance: a study of Greek firms implementing ISO 9000. Total Quality Management 13: 827-841.
Van der Spiegel, M., Luning, P.A., De Boer, W.J., Ziggers, G.W. and Jongen, W.M.F., 2006. Measuring effectiveness of food quality management in the bakery sector. Total Quality Management & Business Excellence 17: 691-708.
Van der Spiegel, M., Luning, P.A., Ziggers, G.W. and Jongen, W.M.F., 2003. Towards a conceptual model to measure effectiveness of food quality systems. Trends in Food Science & Technology 14: 424-431.
Wallace, C. and Williams, T., 2001. Pre-requisites: a help or a hindrance to HACCP? Food Control 12: 235-240.
Yang, C.C., 2008. Improving the definition and quantification of quality costs. Total Quality Management & Business Excellence 19: 175-191.
Zugarramurdi, A., Parin, M.A., Gadaleta, L. and Lupin, H.M., 2007. A quality cost model for food processing plants. Journal of Food Engineering 83: 414-421.
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Nov 11, 2013
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