13051625 Material Management

8/7/2019 13051625 Material Management

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MaterialMaterialmanagementmanagement







Definition

Materials Management can be defined as that

function of business that is responsible for the

coordination of planning, sourcing, purchasing,

moving, storing and controlling materials in an

optimum manner so as to provide service to the

customer, at a pre-decided level at a minimum cost

- web definition



Meaningit is a business function for

planning, purchasing, moving ,storing material in a optimum waywhich help organization to minimize

the various costs like inventory cost,material handling cost anddistribution cost.



SCOPE OF MATERIALMANAGEMENT

vEmphasize the acquisition aspect;vInventory control and stores management,

v To materials logistics, movement controland handling aspects.

vPurchasing, supply, transportation,materials handling etc.,

vSupply management’ or ‘logistics

management’ vCovers all the interrelate activities

concerned with materials.



five M’s of an industrialfive M’s of an industrial

vMEN

vMONEY

vMACHINEvMATERIAL

vMETHODS



Why material ManagementWhy material Management?



Amount spent on material isAmount spent on material isincreasing in relation to theincreasing in relation to the



It offers considerableIt offers considerablef r r in t.



Important form of current assetImportant form of current asset

in organisationin organisation



It adds value to theIt adds value to the



Contribute to the quality of Contribute to the quality of n r t



Social responsibility of Social responsibility of in



Important for safety of Important for safety of l n nvir nm nt



Objective of material

• Three basic objectives are

v buying/purchasing

v

storagev movement



Objective of materialm n m nt



vPay low price for bestvalue obtain

vNegotiationvVendor selection

vRight quality on righttime



Storage



vMinimizing transportationand

material handling costvAdequate and properstorage and

preservation



Movement / Distribution



Movement / Distribution

vdistribution of finishedgood to customer

vDisposal of raw material



Primary objectives of material management v

Low pricevHigh inventory turn over

vLow cost acquisition and

possessionvContinuity of supply

vConsistency of quality

vFavorable supplier relationvGood record



Secondary objectives of

vNew materials and products

vEconomic make- or- buy

v

StandardizationvProduct improvement

vInterdepartmental harmony

vForecasts



Importance of materialm n m nt

vLower prices for material &equipment

vFasten inventory turnover

vContinuity of supply

vReduce transportation cost

v

Reduce material obsolescevBetter inter-departmental

cooperation



Merits of material

• Helps to save cost

• Efficiency in work

•

Best control over inventory• Best utilization of resources

• Reduce fault and damages



demerits

• Continuous observation isrequire

• It requires good infrastructurefacility which may need hugeinvestment

• Extra man power can require

Documents

13051625 Material Management