TUTORIAL 5
MATERIAL MANAGEMENT
Definition
Material Handling
Logistics
The movement, protection, storage and control of materials and products through out manufacturing, warehousing, distribution, consumption and disposal
Planning, execution and control of the procurement, movement and stationing of personnel, material and other resources to achieve the objectives of a campaign, plan, project, or strategy. It may defined as the management of inventory in motion and at rest.
2.How material handling and logistic works?
Materials handling is the function of moving the right
materials to the right place in the right time, in the right
amount, in sequence, and in the right condition to minimize
production cost.
Materials handling covers virtually all aspects of all
movements of raw materials, work -in-process or finished
goods within a factory or warehouse. Basically, material
movement is considered as a non value adding activity.
Hence, primary objective of a supply chain
manager should be to eliminate material handling where is
possible. This includes minimizing inventory, travel distance,
bottlenecks and loss due to spillage, wast, wrong handling,
3.“Material handling and logistics makes the supply chain works”.
Material handling is the movement, protection,
storage and control of materials and products
throughout manufacturing, warehousing, distribution,
consumption and disposal. As a process, material
handling incorporates a wide range of manual, semi automated
and automated equipment and systems
that support logistics and make the supply chain
work. Their application helps with:
Discuss this statement “Material handling and
logistics makes the supply chain works”.
Forecasting
Resource allocation
Production planning
Flow and process management
Inventory management and control
Customer delivery
After-sales support and service
4.Discuss the term material management.
Purchasing: Basically, the job of a materials
manager is to provide , to the user departments right
material at the right time in right quantity of right
quality at right price from the right source
.
Stores: Once the material is delivered , its physical
control , preservation , minimization of obsolescence
and damage through timely disposal and efficient
handling, maintenance of records, proper locations
and stocking is done in Stores.
Inventory control:One of the powerful ways of
controlling the materials is through Inventory control.
It covers aspects such as setting inventory levels,
doing various analyses such as ABC , XYZ etc
,fixing economic order quantities (EOQ), setting
safety stock levels, lead time analysis and reporting.
5.What are the aims of materials management? Discuss with related “R” in materials management
AIM OF MATERIAL MANAGEMENT
Low Prices:
If materials department succeeds in reducing the
price of items it buys, it contributes in not only
reducing the operating cost but also in enhancing
the profits.
Lower Inventories-
By keeping inventories low in relation to sales, it
ensures that less capital is tied up in inventories.
This increases the efficiency with which the capital of
the company is utilized resulting in higher return on
investment. Storage and carrying costs are also
lower.
Reduction in Real Cost:-Efficient and economical
handling of materials and storage lowers the
acquisition and possession cost resulting in the
reduction in the real cost.
Regular Supply: -Continuity of supply of materials is
essential for eliminating the disruption in the
production process. In the absence of regular supply
of materials, production costs go up
Procurement of Quality Materials: -Materials
department is responsible for ensuring quality of
materials from outside suppliers. Therefore, quality
becomes the single most objective in procurement of
materials.
Efficient handling of Materials : -The effective
material control techniques help the efficient
handling of materials resulting in the lowering of
production cost.
6.Briefly explain the purpose of material management
❎Maximizing customer service
❎Maximizing efficiency of purchasing and production
❎Maximizing inventory investment
❎Maximizing profits
7.What are the functions of material management? Briefly discuss.
Inventory Arrangement and Control: In the
cosmopolitan world of today, the inventory
arrangement would mean the purchase of materials
to be stored before entering the production stage or
sold out, such that the stock cost is zero.
There are three kinds of inventories:
a) raw material,
b) purchased goods, and
c) finished components.
Their inventory control is the responsibility of the
materials management department, production
department and the sales department. It is always
important to ensure that inventory at different levels
is maintained, the raw materials are available at
each level and that there is proper flow of materials
from one production facility to another at all levels in
a manufacturing firm.
Continual and effective flow and supply of materials:
The required material by all production center and
other departments should be ensured for its
continuity in flow and supply by the material
management department. Many a times, low or zero
inventories lead to stock-outs and halts in
production.
Material Quality Control: The quality of the finished
products manufactured will depend upon the quality
of raw material used to manufacture those products.
Therefore, the purchase of right quality of materials
is indeed very important.
System Efficiency: This function ascertains the
efficiency of the system being used. If the system
used for materials management in inept of faulty, the
above objectives cannot be met, irrespective of the
procedure adopted.
8.Explain the objectives of material management.
⭐ To maintain a high inventory turnover , by reducing
excess storage , carrying costs and inventory losses
occurring due to deterioration
⭐ To maintain the specified material quality level and a
consistency of quality which permits efficient and
effective operation
⭐ To buy at the lowest price , consistent with desired
quality and service
What is Forklist?
Forklift is a vehicle with a pronged device in front for
lifting and carrying heavy loads
Advantage
While buyers are looking for forklifts that would help them to get
the best value for the money without compromising the quality, it
is important to check out the various disadvantages of used
forklifts. The main disadvantage is that the used forklifts could
never be able to replace the new one. The aesthetic looks of the
used equipment would never be like the new one. A second-hand
machine would always be prone to damages, may need regular
maintenance and repair. The used equipment may not have the
safety level as the new one. As it is the used one, warranty may
not be available for the same or it could be nearly expiring. Extra
payment may have to be incurred by the owner when used
equipment is bought.
Disadvantage
To move the heavy load, buyers need not always buy the new
machine to accomplish their job. Used Forklifts can also be quite
useful and have become a popular choice for the industries
across the globe. Buying second-hand forklifts have many
advantages. The most important advantage is the price
advantage. Huge amount of money gets saved if buyers buy the
forklifts that are not new. When buyers are spending money for
buying a new forklift, there is always a chance of depreciation.
When second-hand forklifts are brought, the possibility of
depreciation expense can be avoided. There is no need to bear
the rental or lease payments.