T.Y.B.Com | Sem 6 | Business Administration - Material Management | VNSGU

Material Management
Material management is an activity undertaken to plan, direct and co ordinate the materials and their stock from beginning of production process to its end.

It includes purchasing of raw materials, storage of raw material, inventory control, dispatching/forwarding & also its handling which is popularly known as material handling.

Objectives of Material Management
Primary Objectives
1) Purchasing :
Purchasing is the impotant objective of material management. Purchasing is the centre of profitability. Through material management purchasing can be done in a scientific manner and costs can be minimised.
2) Inventory Control
When crores of rupees are spent on purchasing of raw materials by industrial enterprises, it is necessary to store scientifically various materials purchased. In fact effective Inventory control results into considerable financial savings
3) Continuity of Supply
One of the objective of Material Management is to maintain a continuous flow of various materials, so that production process is not interrupted
4) Maintaining Quality of materials
Quality of finished goods depends on the quality of materials used. Hence Material Management has to purchase materials as per the standard laid down by the production management. The quality of materials must be maintained so that marketing of product becomes easy.
5) Maintaining efficiency of Department
The efficiency of Material Management is an impoertant pre condition of successful material management. Authorities and responsibilities are delegated among them impartially and according to the principles of specialisation.
6) Establishing Good Human Relations
Good human relation is an important feature of material management. It aims at maintaining good relations with suppliers so that enterprise does not suffer even in difficult times.

Secondary Objectives

1) To make or Buy
It is basic decision. Top management consults materials management before taking decision whether to make the components in factory or buy them from outside.
2) Product Development
Through surveys and reasearch, material management has to collect data about cahnges and trends of buyers preferences and fashions, so that existing product may be adjusted to current demand.
3) Standardisation
For standardisation of finished goods, it is necessary to use standardised raw materials during manufacruring process. Hence Material Management strives to obtain standardised materials.

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