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Essentials of Material Control Explained

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22 views8 pages

Essentials of Material Control Explained

Uploaded by

santhu
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd

Material Control

Meaning
Material control is a system which ensures
that right quality of material is available in the
right quantity at the right time and right place
with the right amount of investment
Dimensions of Material Control:

(1)Quantity or unit control


(2) Rupee or financial control.
Need for (or Objectives of)
Material Control:
1. Availability of Materials
2. No Excessive Investment in Materials:
3. Reasonable Price:
4. Minimum Wastage:
5. No Risk of Spoilage and Obsolescence:
6. Ready Information about Availability of Materials:
7. Misappropriation of Material:
8. Right Amount of Payment to Suppliers:
Essentials of Material Control:

 There should be proper co-operation and co-ordination among the


departments involved in purchasing, receiving and inspection, storage, sales,
production and accounting so that there may be no inadequate availability of
materials which may disrupt production and lose sales.
 Purchases of materials should be centralized
 There should be proper scheduling of materials.
 A good method of classification and codification of materials should be
followed.
 There should be proper inspection of materials when they are received by the
receiving department.
Continue…
 Standard forms for requisitions, orders, issue, transfer of material from one job to the other and transfer
of material from the job to the stores should be used.
 The storage of materials should be well-planned to avoid losses from theft, carelessness, damage,
deterioration
 Perpetual inventory system of materials should be operated to facilitate regular checking and avoiding
closing down factory for stock-taking with this system
 A system of internal check should be introduced to ensure that all transactions involving materials are
checked by properly authorised and independent persons.
 Minimum, maximum and re-ordering levels for each type of material should be fixed to ensure that there
is no shortage of materials and that there is no over-stocking.
 Ordering quantity for each type of material should also be fixed to reduce the ordering costs and carrying
costs of materials.
 A careful choice should be made of the method of valuing the material issues because it affects the cost
of the jobs or processes and the value of the closing stock of materials in the stores.
 Adequate records to control materials during production should be maintained to ensure that there is minimum possible
wastage.
Techniques of Inventory /
Material Control .
 A.B.C Analysis
 EOQ (Economic Order Quantity)
 VED Analysis
 Proper purchase procedure
 Fixation of stock levels
 Perpetual inventory system
 FSN analysis
 Periodical inventory evaluation .
 Preparation of material budget
Thank you….

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