A company designed a barcode-scanning system to reduce picking errors. Which cost of quality is this?

External failure costs arise when products fail after delivery to customers, leading to issues such as returns, warranty claims, and lost sales. Since the barcode-scanning system aims to prevent errors before they reach the customer, it does not fall under this category, as it seeks to avoid these costs rather than address them post-failure.

Internal failure costs are incurred when defects are discovered before products are delivered to customers, such as rework or scrap costs. While the barcode system may help in reducing internal failures, its primary function is to prevent errors from happening in the first place, thus making it more aligned with prevention costs rather than internal failures.

Appraisal costs are related to measuring and monitoring activities to ensure quality, such as inspections and testing. Although implementing a barcode system does involve some measurement aspects, its main purpose is to avoid errors altogether, which is characteristic of prevention costs rather than mere appraisal.