Materials Management

Materials Management ?
• Materials management is one of the
important subsystems vital to the operations
of the firm and is composed of an integrated
group of subsystems. The various subsystems
of materials management include
Procurement, Production Planning, materials
Handling, Traffic Management, Shipping, etc.
 Ends with
Begins with Issuance of production
Determination of the Materials ships in time to meet
quantity & quality of management customer needs on
materials schedule and at lowest
cost
 Materials Management
• L.J Derose has defined materials management
as “ the planning, directing, controlling, co-
ordination of all those activities concerned
with materials and inventory requirements,
from the point of their inception to their
introduction into the manufacturing process.”
 Significance of Materials Management

• Ensure adequate supply of raw materials.

• Excessive investment in stocks will be avoided.
• Effective utilization of materials and other
facilities will be ensured.
• Improve productivity as raw materials of right
quantity are made available.
• Inventory losses will be minimized.
 Scope of Materials Management
• Determines the quality, kind of quantities of raw materials
and supplies needed by the production department.
• Arranging for purchase of raw materials and supplies
through the purchasing department.
• Taking delivery of raw materials and supplies purchased by
the receiving department.
• Arranging for storage of raw materials and supplies by the
stores department.
• Maintenance of required level of stock of raw materials and
supplies.
 Classification of Materials
• Raw Materials : basic un-fabricated materials (in natural state) for
e.g.: leather in footwear industry, yarn in textile, timber in
furniture, etc.

• Consumable stores and Supplies : small items which are required

for operations and maintenance of plant and machinery. For e.g. :
lubricants, nuts, bolts, cotton waste, pipes, etc.

• Fabricated Parts : finished or semi-finished products purchased

from outside and are used as parts of the final product.
Examples : clutch plates, accessory, small tools, bearings etc.
 Classification of Materials
• Industrial Equipments : types of machines required for
production of goods and services. example : furnace,
driller, cutter, boiler etc.

• Office stationery and Supplies : small items used for

clerical operations. Paper, carbon paper, pens, pencils,
inks, erasers, pins, staplers, etc.

• Office Appliances : such as typewriters, computers,

scanners, intercom system, etc.
Thank you