Define Rework Cost

by Joanne Cichetti; Updated September 26, 2017

According to businessdictionary.com, rework cost is the standard or actual cost of correcting defective work. This is a preventable cost that increases overall operating costs.

Correcting Errors

Often there has to be rework in a manufacturing plant, which affects the total annual cost of operations. However, rework cost is often overlooked and is not identified as a separate operating cost. This can lead to erroneous figures on the company's accounting books.

Tracking Rework Cost

To track the exact rework cost, include factors like materials and labor along with the cost of operating the equipment used in rework. Other considerations are the cost of space allocated, paperwork and administration time. Add up all these costs to realize the true rework cost.

Quality cost

Quality cost is a standard technique used for evaluating the trends in the costs of products and services. This includes rework costs, repairs and maintenance. The primary role of quality cost is to provide a tool for checking whether or not the products are meeting the customers' requirements.

Reducing Rework Costs

To reduce rework costs, rework projects should be reviewed and analyzed to identify the mistakes that necessitated the rework. Strategies should then be introduced to avoid repeating those mistakes.

About the Author

Joanne Cichetti has written articles and Web content professionally since 2009, focusing primarily on health and lifestyle. In order to further pursue her writing career professionally, Cichetti inducted herself in the Long Ridge Writers Group, and she looks forward to having a novel published under their guidance.