Which of the following best describes External Failure?

External failure refers to the costs associated with defects that escape the control of the manufacturing or production process and are identified after the product has been delivered to the customer. This includes expenses related to repairs, servicing, handling warranty claims, addressing customer complaints, and managing product returns. Essentially, when a product fails to meet quality standards after being sold, resulting in the need for corrective actions, these expenses are categorized as external failure costs.

In contrast, the other options represent different aspects of quality management and cost categorization. For example, quality training sessions for staff serve to prevent defects from occurring in the first place, aligning with the concept of preventive costs. Defects found during production relate to internal failure costs since they are identified before the product reaches the customer. Quality audits performed on suppliers focus on ensuring that the components provided by external entities meet set standards, which is part of the quality assurance process, but does not directly relate to expenses incurred due to failures occurring after delivery.