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2014 (Vol. 7, Issue: 8)
Article Information:

Modeling and Analysis of Relationship between Quailty Cost and Sales Revenue using System Dynamics

Shang Shanshan
Corresponding Author:  Shang Shanshan 

Key words:  Quality cost, Quality level, Sales revenue, System dynamics, , ,
Vol. 7 , (8): 1500-1506
Submitted Accepted Published
May 03, 2013 June 05, 2013 February 27, 2014

The aim of this study is to analyze the relationship between quality cost and sales revenue so that to give some guidance to managers and researchers. By establishing system dynamics model which is realized by the Venism, the paper analyzes the relationship between quality cost and sales revenue. The paper proves the relationship that with the enhancement in the quality level, the prevention and appraisal cost increases and with the increase in prevention and appraisal cost, the failure cost decreases. By the SD model, the paper proves that the quality cost has direct influence on the sales revenue of the enterprises. The paper verifies that with more investment in the quality cost, the sales revenue increases greatly and with more investment in quality cost, quality level enhancing, the ratio of quality cost and sale revenue will reduce.
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  Cite this Reference:
Shang Shanshan, 2014. Modeling and Analysis of Relationship between Quailty Cost and Sales Revenue using System Dynamics.  Research Journal of Applied Sciences, Engineering and Technology, 7(8): 1500-1506.
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ISSN (Online):  2040-7467
ISSN (Print):   2040-7459
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