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Material Management Functions, Need, Use

Materials management is a method for planning, organizing, and controlling materials flow in a company. It involves determining materials quality and quantity, procurement, storage, transportation, and distribution to ensure production meets demand at lowest cost. Materials are classified as direct materials, which are essential to the product, or indirect materials, which do not affect the final product. The functions of materials management include production planning, purchasing, storage, transportation, materials handling, and receiving to have the right materials available as needed and minimize costs. The goal is efficient operations through inventory control, quality control, reduced costs, and on-time delivery.

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Saleha Gaffar
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254 views

Material Management Functions, Need, Use

Materials management is a method for planning, organizing, and controlling materials flow in a company. It involves determining materials quality and quantity, procurement, storage, transportation, and distribution to ensure production meets demand at lowest cost. Materials are classified as direct materials, which are essential to the product, or indirect materials, which do not affect the final product. The functions of materials management include production planning, purchasing, storage, transportation, materials handling, and receiving to have the right materials available as needed and minimize costs. The goal is efficient operations through inventory control, quality control, reduced costs, and on-time delivery.

Uploaded by

Saleha Gaffar
Copyright
© © All Rights Reserved
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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MATERIAL

MANAGEMENT
BY
SHAIK HAFEEZA
INTRODUCTION:
• Materials Management is a method for planning, organizing and
controlling the activities that are related to the flow of materials in a
company.
• This can lead to the control of the location, movement and time of those
materials from their introduction, production, manufacturing process and
final delivery.

DEFINITION:
‘Materials Management’ is a term used to connote “controlling the
kind, amount, location, movement and timing of various commodities
used in production by industrial enterprises”.
• It begins with the determination of materials quality and quantity and
ends with its issuance to production to meet customer’s demand as per
schedule and at the lowest cost.

• Materials Management is a basic function of the business that adds


value directly to the product itself

Thus, material management is an important function of an organization


covering various aspects of input process, i.e., it deals with raw materials,
procurement of machines and other equipment’s necessary for the
production process and spare parts for the maintenance of the plant.
Thus in a production process materials management can be considered as
an preliminary to transformation process.
Materials are classified by direct materials or indirect materials-

DIRECT MATERIALS:
Direct materials are those materials or raw materials in which value
and importance are identified in order to make the product that is
needed and they also represent the cost and benefit of the process.
These direct materials are essential for the quality of the product
because without them the product could lose value in the market.
They are vital in the inventory and it is not possible to get out of
them.
INDIRECT MATERIALS:
These are those materials that are part of the production of the
product but do not make a difference to the final product. These
cannot be calculated or measured, so their presence is not of high
relevance in the delivery of the final result.
Functions of Material Management:
 1.Production and Material Control:
Production schedules are prepared on the basis of orders received or anticipated
demand for goods. It is ensured that every type or part of material is made
available so that production is carried on smoothly.

2. Purchasing:
Purchasing department is authorized to make buying arrangements on the basis
of requisitions issued by other departments. The effort by this department is to
purchase proper quality goods at reasonable prices.

3. Non-Production Stores:
Non-production materials like office supplies, perishable tools and maintenance,
repair and operating supplies are maintained as per the needs of the business.
These stores may not be required daily but their availability in stores is essential.
The non-availability of such stores may lead to stoppage of work.
4. Transportation:
The transporting of materials from suppliers is an important function of materials
management. It all depends upon the quantity and frequency of buying materials.
The purpose is to arrange cheap and quick transport facilities for incoming
materials.

5. Materials Handling:
It is concerned with the movement of materials within a manufacturing
establishment and the cost of handling materials is kept under control. It is
also seen that there are no wastages or losses of materials during their
movement.

6. Receiving:
The receiving department is responsible for the unloading of materials, counting
the units, determining their quality and sending them to stores etc. The
purchasing department is also informed about the receipt of various materials.
NEED:
• To have material in hand when needed at the time of emergency.

• To have right material on hand when needed.

• To minimize inventory investment

• To operate efficiently.

• To gain economy in purchasing, particularly where discounts are


given for volume or bulk purchases.

• To carry reserve stocks to avoid stock outs, especially when there


may be unexpected surges in demand over short periods of time.
• To stabilize fluctuations in a consumption due to seasonal and other
factors.

• To avoid wastages.

• To ensure maximum returns on working capital.

• To properly utilize The equipment so there are no break downs due


to late supply of materials.

• Congestion in the stores and at different stages of manufacturing is


avoided.
USES:
• Proper material management helps in Quality control.
• As the material is order only according to the need it Reduces
storage on site.
• Adequate amount of materials lead in Better handling of
materials.
• It Avoids excessive investment in stocks.
• Reduces the overall costs of materials.
• Smooth flow of materials.
• Good material management Improves productivity.
• It helps in Improvement in delivery of the product.
• Increases profitability.
• It helps in building Better relations with suppliers.
ANY QUIERIES?

THANK YOU

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