How do you determine and define acceptable quality when performing quality control inspections? How many defects are too many defects?

The acceptable quality limit, AQL, is a base number for quality control inspections. AQL is, in essence, the maximum number of defects for a given product run.

What is the AQL and how can you control it for your product quality standards?

What is AQL?

The acceptable quality limit (AQL) is an inspection standard defined in ISO 2859-1 as the “quality level that is the worst tolerable.” It’s the maximum number of defective units allowed in a production run, beyond which the entire batch is rejected. It’s expressed as a percentage or ratio of the number of defects compared to the total quantity.

Basically, the AQL tells you how many defective components are considered acceptable during random sampling quality inspections.

For example, you have an AQL of 1%. This means that no more than 1% of the batch can be defective. If a production run consists of 100 products, only 1 product can be defective. If 2 products are defective, the entire batch is scrapped.

If the batch falls outside of the AQL, it’s considered rejectable. With the above example, 2 or more defective products would be the rejectable quality limit (RQL).

Basically, the AQL is a quality control procedure that allows the buyer and seller to agree upon the average quality levels of the products. The AQL is a ratio of defects to total lot size. The “lot size” is the total number of products in a given order.

Note: The acceptable quality limit can also be referred to as the acceptable quality level. We prefer to use the term “limit” because it implies that the AQL is the maximum possible. It’s not the level of defects allowed; it’s the limit.

AQL 101: What Are Acceptable Quality Limits? quality control checklist

What are the three levels of AQL?

There are three classification levels of AQL: critical, major, and minor. Usuall, there will be an individual AQL ratio for each classification.

Critical

The critical AQL is a defect that is considered unsafe or hazardous for the user. This number should always be 0% because the user could be harmed or injured when using the product. If you have even one critical defect, it’s recommended to throw out the entire batch to avoid liability or injury.

Major

A major defect can result in the product’s failure, which means it is not usable or saleable. These are considered “not acceptable” for the end user. If you were to sell this product, it would likely be returned with negative reviews and a major customer service concern. On average, this AQL is around 1.5-2.5%.

Minor

A minor defect falls below defined quality standards but doesn’t affect the product’s usability. Most users will be okay with this product. Generally, the minor-AQL averages 4%. However, if you sell a high end product, you might want a lower AQL to ensure the greatest possible quality for your customers.

Keep in mind that the AQL for each classification will vary based on the product type. For a T-shirt, you can have some minor defects like missed stitches or a slightly discolored product. For a commercial plane, you wouldn’t want any minor defects whatsoever.

How do you determine the AQL?

There are usually set industry-wide standards for your products’ acceptable quality limits. For example, AQL for clothing products is generally higher than for electronics.

Work with a sourcing partner or AQL software to calculate the right limit for your product and industry.

How do you agree on the AQL?

You usually can’t just set an acceptable quality limit and expect that the supplier will comply. The AQL is a negotiation between both parties.

Ideally, you’d love a 0% AQL. But this isn’t realistic. Almost every large order will have some sort of defective concerns.

Your supplier is not expected to deliver defect-free goods 100% of the time. It is your responsibility to control the quality of processed goods.

(However, your supplier is expected to deliver critical defect-free goods. Critical defects can be a serious concern for sellers and end users.)

The goal is to minimize the severity and frequency of these defects. You also want to ensure that the supplier takes responsibility for the defect.

Negotiations

Usually, you’ll want to approach your supplier with an AWL number. For example, you might start negotiations with:

“I want no more than 1.5% defective units per order quantity.”

The supplier might come back with 3% units. You agree to settle on 2% as an average over 5 production runs. This means that one production run could have a higher defect rate if another product run has a lower defect rate.

See our negotiation services here.

P.S. You can request an “acceptance on zero” plan. This is where even one defect throws out the entire batch. However, unless you’re selling a life-threatening product like automobiles, most suppliers won’t agree to this. Even pharmaceuticals have an AQL!

AQL 101: What Are Acceptable Quality Limits? quality control aspects on laptop

Contract

After agreeing upon an AQL, you should draw up the quality standards in a formal contract. This contract should include three key elements:

  1. How many samples will be inspected per batch?
  2. What is the limit of defects that are considered acceptable versus rejectable per batch or averaged over a set number of batches?
  3. How will the supplier fix the order? What will the timeline look like for a re-do of products? Will there be a discount?

Learn how to create a sourcing contract here.

Or have Ask Idea Sourcing draw up a legal, thorough contract agreement for you.

Risk Responsibility

You should also consider including a clause regarding liability. Who is responsible and assumes the risk if defective products make it to the consumer?

Generally, the party that performs the inspections will assume the risk. If the buyer performs inspections through a third-party, the buyer and third-party inspector are generally responsible for any “missed” defects. If the factory implements quality control processes, they maintain responsibility if defects fall through the cracks.

We recommend including these liability concerns in your contract to avoid legal gray areas in the case of an incident, especially with regards to critical defects.

Consistent Inspections

The AQL usually refers to the final inspection of products. We recommend negotiating with your supplier to create a series of inspections throughout the process. This will help reduce the number of end-product defects because you can catch potential problems earlier on in the process.

You should also consider setting other quality standards aside from defects. This can include packaging and product conformity.

Read: Why And How To Use Quality Inspections For Overseas Sourcing

AQL 101: What Are Acceptable Quality Limits? compass representing quality levels

The Bottom Line

The AQL determines how many products can be defective in a production run. The AQL is a target maximum that separates an acceptable batch from a rejectable one. Basically, does this lot pass the quality standard inspection overall?

A sourcing contract should outline the acceptable limit, the number of samples per inspection, and the risk that each party assumes with regards to quality.

How do you come up with the appropriate AQL for your products and supplier relationship?

Work with Ask Idea Sourcing. We have experience negotiating appropriate limits of acceptability for different industries, products, and suppliers. We can then draw up comprehensive contracts to protect both you and your supplier.

Let us handle your quality control inspections

And let us facilitate the relationship between you and your supplier.

Contact us now to get started sourcing quality, low-defect goods.