Internal failure costs
/Internal failure costs are those costs of quality associated with product failures that are discovered before a product leaves the factory. These failures are discovered through the firm's internal inspection processes. Examples of internal failure costs are:
Failure analysis activities
Product rework costs
Product scrapped, net of scrap sales
Throughput lost
Internal failure costs are one of the four costs of quality. The other three costs are preventive costs, appraisal costs, and external failure costs.