Supplier Quality, Development & Audits worked example

Supplier Quality Trend at 29% adverse trend severity factor: a worked example

This worked example runs the supplier quality trend numbers for a tougher week than the baseline: 29% adverse trend severity factor instead of the typical 40%. Estimates the cumulative cost exposure tied to a worsening supplier quality trend over a tracking window.

The inputs for this scenario

  • Reporting periods tracked: 12 months (held at the documented default)
  • Quality failure cost per period: 2,500 $/month (held at the documented default)
  • Adverse trend severity factor: 29 % (the input this scenario stresses; the baseline uses 40)
  • Scorecard review adder: 1,500 $ (held at the documented default)

Working through the calculation

  • The calculation starts from the formula this tool documents: Trend exposure = periods x quality cost per period x adverse severity% + review adder.
  • Total supplier quality trend cost works out to 10,200 $ at these inputs, and this is the headline figure for the scenario.
  • Supplier quality trend cost per unit works out to 850 $ / piece at these inputs.
  • Variable supplier quality trend cost works out to 8,700 $ at these inputs.
  • Fixed supplier quality trend adder works out to 1,500 $ at these inputs.

How this compares with the baseline

  • Against the tool's baseline example, where adverse trend severity factor sits at 40% and the headline result is 13,500 $, this scenario comes in 24.44% below the baseline at 10,200 $.
  • Use it during quarterly business reviews, when ranking suppliers for development resources, or when building the case that a drifting supplier needs formal corrective action. A result at this level usually justifies acting on the stressed input before touching anything else, because every other figure in the table is downstream of it.

Results at a glance

  • Total supplier quality trend cost: 10,200 $ (headline result)
  • Supplier quality trend cost per unit: 850 $ / piece
  • Variable supplier quality trend cost: 8,700 $
  • Fixed supplier quality trend adder: 1,500 $

Run it with your numbers

  • To rerun this with your own numbers, open the live Supplier Quality Trend calculator, set adverse trend severity factor to your actual value, and adjust the remaining inputs to match your operation.

Last reviewed 2026-05-12.