MATERIAL CONTROL MEANING , OBJECTIVES, INVENTORY CONTROLL

MATERIAL CONTROL MEANING , OBJECTIVES, INVENTORY CONTROLL

• 1.
  Material Control
• 2.
  Material control isa 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 Meaning
• 3.
  (1) Quantity orunit control (2) Rupee or financial control. Dimensions of Material Control:
• 4.
  1. Availability ofMaterials 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: Need for (or Objectives of) Material Control:
• 5.
   There shouldbe 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. Essentials of Material Control:
• 6.
   Standard formsfor 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. Continue…
• 7.
   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 Techniques of Inventory / Material Control .
• 8.
  Thank you….