Explain the effect of quality on sales.

Ans. The two main factors which influence the purchasing decisions are the price and the quality of product. A customer considers the product quality first and later the price. It is known that in a competitive market, the sale of a product may suffer if its price is too high. It is therefore essential, that the importance of product quality in creating and maintaining sales is realized by everyone in the company and conscious efforts are made to achieve a high standard of quality to enhance the sales appeal of a product. The survival of the company depends on the income it gets from selling its products and services, and the ability to sell is based on the fitness for use. Hence, the company functions concerned with quality for use are known as quality functions. Quality is a potent weapon in competition, sometimes even more effective than price.

See Also : Necessity of Product Control During Inspection

 For instance, a particular line of a company may not be able to reduce the price of its product due to factors such as higher cost of labour, unfavourable location of the plant. The use of quality as a weapon may take other forms, such as better after sales service, and longer guarantee periods. Any salesman will tell you, that the quality reputation of a company is great asset which makes selling very much easier. It also helps in growth and diversification. A satisfied customer is the best advertisement for the quality image of any company.