Material Control in Business

Study Notes

Material Control Business

Introduction

Material control is a critical aspect of any business that relies on the consumption and manipulation of physical materials to create products or services. It involves the systematic and efficient management of materials from the stage of procurement to their eventual disposition. Effective material control is essential for maintaining production schedules, ensuring product quality, conserving resources, and minimizing waste.

Functions of Material Control

The primary function of material control is to ensure the availability, timely delivery, and proper utilization of the right materials in the right amounts to support the production needs of a business. Some of the key areas of focus for material control include:

Purchasing and Receiving

The procurement process involves identifying, selecting, and acquiring the necessary materials from suppliers. Effective material control requires understanding the market conditions, establishing relationships with reliable vendors, and negotiating favorable contract terms. Once purchased, the materials must be safely transported and received at the intended location.

Inspection and Storage

Upon arrival, materials must be inspected for compliance with specifications and stored properly. This involves verifying the incoming shipments against purchase orders, analyzing their physical characteristics, and documenting the process. Proper storage conditions help preserve the quality and longevity of the materials and mitigate the risk of damage or spoilage.

Issuing and Maintenance

Materials must be issued to production teams in a timely manner and tracked throughout their usage. Regular maintenance is required to ensure that the material remains in good condition and minimizes wastage. Additionally, maintaining accurate stock records and updating inventory levels helps prevent overstocking and understocking situations.

Objectives of Material Control Systems

The primary objectives of an effective material control system include:

Ensuring uninterrupted production by making available all types of required materials at the right time and place
Providing high-quality materials to maintain product quality and reputation
Minimizing waste and loss by conserving resources and preventing unnecessary handling
Controlling investments in stock by optimizing inventory levels and reducing capital tied up in unused materials

Advantages of Effective Material Control

An efficient material control system offers several advantages, such as:

Improved operational efficiency through better coordination between departments
Reduced costs due to more precise procurement and inventory management
Increased customer satisfaction with improved on-time delivery performance
Lower environmental impact through resource conservation and reduced waste generation

Best Practices for Material Management

To achieve successful material control, businesses should consider adopting best practices like setting standards for material specifications and quality, conducting regular checks on supplier performances, tracking direct/raw materials inventories and their associated costs, and having a comprehensive material plan in place. Inventory management software or MRP/ERP systems can further assist in tracking, organizing, and planning for inventory, thereby improving overall material management efficiency.

Description

Explore the importance, functions, objectives, advantages, and best practices of material control in business operations. Learn about purchasing, inspection, storage, issuance, maintenance, and system objectives to optimize material management efficiency.