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  • Materials Management Consists of

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    Amit Bajaj
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    Materials management consists of planning for demand estimation, procurement, and ensuring the right materials are available at the right price. The key goals are optimal acquisition, inventory turnover, good vendor relationships, cost control, and eliminating losses. The process involves demand forecasting, purchasing, receiving, inventory control, issuing materials, and disposal. Purchasing aims to procure quality items in appropriate quantities at minimum prices on time through centralized purchasing for lower costs and better management control using purchase orders that specify details of materials, pricing, delivery and payment terms. Inventory is controlled through techniques like ABC analysis, VED analysis, economic order quantity models, and setting reorder levels and safety stock.

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    Material Management

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    Materials management consists of planning for demand estimation, procurement, and ensuring the right materials are available at the right price. The key goals are optimal acquisition, inventory turnover, good vendor relationships, cost control, and eliminating losses. The process involves demand forecasting, purchasing, receiving, inventory control, issuing materials, and disposal. Purchasing aims to procure quality items in appropriate quantities at minimum prices on time through centralized purchasing for lower costs and better management control using purchase orders that specify details of materials, pricing, delivery and payment terms. Inventory is controlled through techniques like ABC analysis, VED analysis, economic order quantity models, and setting reorder levels and safety stock.

    Copyright:

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    Download as DOCX, PDF, TXT or read online from Scribd
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    15 views4 pages

    Materials Management Consists of

    Uploaded by

    Amit Bajaj
    Materials management consists of planning for demand estimation, procurement, and ensuring the right materials are available at the right price. The key goals are optimal acquisition, inventory turnover, good vendor relationships, cost control, and eliminating losses. The process involves demand forecasting, purchasing, receiving, inventory control, issuing materials, and disposal. Purchasing aims to procure quality items in appropriate quantities at minimum prices on time through centralized purchasing for lower costs and better management control using purchase orders that specify details of materials, pricing, delivery and payment terms. Inventory is controlled through techniques like ABC analysis, VED analysis, economic order quantity models, and setting reorder levels and safety stock.

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    Attribution Non-Commercial (BY-NC)
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    of 4

    Materials Management consists of

    Planning For material Demand Estimation Procurement Issues Define :- Ensure availability of right material, in right quantities at right price from right sources

    Operative Goals : 1) Optimum Materials Acquisition 2) Optimum inventory turnover rate. 3) Good vendor relationship 4) Material Cost control 5) Effective issue and distribution 6) Eliminate losses and pilferage

    3. Process of material management

    1. Demand, forecasting and planning 2. Purchasing 3. Receipt inspection and storage 4. Inventory control 5. Issue and control 6. Disposal and condemnation

    7. Minimizing Losses and Pilferage. Demand forecasting and planning standardization Non duplication of inventory Variety Reduction Economical Purchase cost Efficient use of materials. Method of Demand Forecasting i) Period Method ii) Arithmatic Average Method iii) Moving Average Method. It is the uncertain demands which pose the most problems.

    2. Purchasing Aim Procurement of items of acceptable quality in appropriate quantities at the minimum price at the right time. Centralised Purchasing i) Lower Costs. ii) Quantity discounts. iii) Lower Inventory Cost iv) Better Management Control. Purchasing Procedure 1. Drawing of specification 2. Inviting Quotations 3. Preparing Comparative Statements inclusive of basic price, Freight,taxes, discounts, delivery period 4. Short listing of suppliers Quantity

    5. Issue of Purchase Orders. Purchase Order: PO reference No. and date Suppliers name and address Quotation reference Description of materials Specifications Brand name Size Quantity Number of units Pack size /weight Special packing details (if any) Price and total value. Unit Price Quantity discounts Sales tax, Excise Duty: give rate of tax. Freight charges and dispatch FOB ,Clearing,inspection,and Forwarding CIF Despatch mode and name of the railway station, Post, Post office Inspection at receivers site Acknowledgement Mode of payment : Draft,cheque

    Inventory control AB C Analysis VED and other analyasis Ordering cost ICC EOQ Lead time Safety stock Reorder level

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