Construction Inventory Control Quiz and Flashcards

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Questions and Answers

What is materials management primarily concerned with?

Supply chain management

Meeting customer demands with quality materials at the lowest cost (correct)

Procurement of machinery and equipment

Inventory management

What is a key aspect of a materials manager's role?

Designing production schedules

Assessing demand and controlling inventory levels (correct)

Determining material quality standards

Negotiating with suppliers

What is the primary goal of materials management systems?

Increasing inventory capacity

Reducing production costs

Adding value to the finished product (correct)

Streamlining procurement processes

What is a common role in materials management?

Inventory analyst Signup and view all the answers

What is an example of a hybrid role in materials management?

Buyer/planner Signup and view all the answers

What does materials management involve, besides managing physical materials?

Procuring equipment and machinery Signup and view all the answers

What is the main purpose of ascertaining a minimum stock level?

To ensure sufficient stock for production purposes Signup and view all the answers

Why is materials management vital in production?

To ensure an unbroken chain of materials for production purposes Signup and view all the answers

What is the significance of re-order point in materials management?

It indicates when to place orders to align with supplier delivery times Signup and view all the answers

What is the primary focus of materials management?

Inventories and production requirements Signup and view all the answers

What does materials management involve?

Managing logistics, stock levels, materials quality, cost, and more Signup and view all the answers

What is the outcome of effective materials management?

Improved production schedules and reduced costs Signup and view all the answers

What is the primary goal of timing purchasing in many industries?

To ensure materials are available just ahead of production Signup and view all the answers

What is the consequence of lack of stock in materials management?

Financial losses through replacement production materials Signup and view all the answers

What is the importance of quality control in materials management?

To ensure good quality products Signup and view all the answers

What can material management teams use to mitigate against material supply disruptions?

Alternative supply systems Signup and view all the answers

Why is it important to gauge supplier levels in materials management?

To ensure items are stocked before they become unavailable Signup and view all the answers

What is the ultimate goal of the five types of materials management?

To ensure successful management of materials Signup and view all the answers

What is a potential issue with generic inventory management systems?

They require significant input from workers, increasing the risk of human error Signup and view all the answers

What is a key benefit of efficient inventory management in construction companies?

Minimizing costs associated with inventory management Signup and view all the answers

What is a key difference between construction inventory management systems and other inventory management systems?

They manage assets throughout their entire life cycles Signup and view all the answers

What is a key advantage of modern construction inventory management systems?

They allow for seamless management of warehouse, purchasing, and receiving Signup and view all the answers

What is a potential consequence of human error in inventory management?

Crippling delays due to lack of proper equipment Signup and view all the answers

What is the broader concept of construction inventory management?

Thinking strategically about resources and process management Signup and view all the answers

What does the days sales in inventory (DSI) figure primarily indicate?

The liquidity of the inventory Signup and view all the answers

Why is a lower DSI generally preferred?

Because it indicates a shorter duration to clear off the inventory Signup and view all the answers

What is a consequence of underutilized inventory?

It is expensive, a nuisance to store, and bad for the balance sheet Signup and view all the answers

What is a benefit of using a robust construction inventory management system?

It provides visibility and oversight to the back office team Signup and view all the answers

What is a key feature of a construction inventory management system?

It provides interconnected digital workflows that reflect and support logistics comprehensively Signup and view all the answers

What is a result of implementing a robust construction inventory management system?

More effective and efficient operations that save personnel time and company money Signup and view all the answers

Study Notes

Materials Management

Materials management is a core function of supply chain management, involving the planning and execution of supply chains to meet the material requirements of a company or organization.
It involves controlling and regulating the flow of material while assessing variables like demand, price, availability, quality, and delivery schedules.
Material managers determine the amount of material required and held in stock, plan for replenishment, and create inventory levels for each type of item.

Roles in Materials Management

Typical roles in materials management include inventory analysts, inventory control managers, materials managers, material planners, and expediters.
Hybrid roles like buyer/planners are also common.

Material Supply Management

Supply chain management requires materials to be distributed to different sites or production centers, each of which needs to be continuously supplied.
Lack of stock can lead to financial losses through replacement production materials or halting production schedules.
Material management teams should mitigate against these situations by using alternative supply systems.

Quality Control

Quality control of materials is important, as good quality materials lead to good quality products.
Factors like durability, dimensional accuracy, dependability, performance, reliability, and aesthetic value are important quality factors for materials management.

Inventory Management

Inventory management is crucial for construction companies, providing the opportunity to think strategically about resource management.
Modern construction companies can manage their warehouse, purchasing, and receiving in a seamless fashion to eliminate waste and lost productivity.
Efficient inventory management systems can minimize costs and improve timeliness and accuracy.

Inventory Management in Construction

Construction inventory management systems differ from other inventory management systems.
They provide a broad, strategic concept that includes managing warehouse, purchasing, and receiving.
They can track and keep records of assets throughout their entire life cycles.

Inventory Control

Minimum Security Stock is the minimum stock level required, considering supplier delivery times, cost of orders, and production requirements.
Re-Order Point is the point at which orders should be made to keep warehouse supplies aligned with supplier delivery times and production schedules.

Importance of Materials Management

Materials management is vital to ensure an unbroken chain of materials for production purposes to meet customer demands.
It saves costs for a finished product while maintaining quality through the materials purchased and used.

Materials Planning

Materials planning includes managing logistics, stock levels, materials quality, cost, and more.
It requires a step-by-step overview of processes and requirements.

Days Sales Inventory (DSI)

DSI is the average age of inventory, indicating the liquidity of the inventory.
A lower DSI is generally preferred, as it indicates a shorter duration to clear off the inventory.

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Description

Discover the importance of efficient inventory management in construction companies, including avoiding human error and delays. Learn how a strategic approach can improve operations and reduce risks.

Construction Inventory Management