POM ASSIGNMENT ON MATERIAL MANAGEMENT

GUIDED BY:- SUBMITTED BY:-

PROF. SAPNA JAIN VIKAS ,ANURAG,

ASHISH,EKAGRA

DefinitionIt is concerned with planning,

organizing and controlling the flow of materials from their initial purchase through internal operations to the service point through distribution.

OR

Material management is a scientific technique, concerned with Planning, Organizing &Control of flow of materials, from their initial purchase to destination.

AIM OF MATERIAL MANAGEMENT

To get

1. The Right quality

2. Right quantity of supplies

3. At the Right time

4. At the Right place

5. For the Right cost

PURPOSE OF MATERIAL MANAGEMENT

•To gain economy in purchasing

•To carry reserve stock to avoid stock out

•To stabilize fluctuations in consumption

Primary•Right price•Low procurement •& storage cost•Continuity of supply•Consistency in quality•Good supplier relations•Development of personnel

Objective of material management

Secondary•Forecasting•Inter-departmental harmony•Product improvement•Standardization•New materials & products•Favorable reciprocal relationships

Economy in material management

•Containing the costs

•Instilling efficiency in all activities

Four basic needs of Material management

1.To have adequate materials on

hand when needed

2.To pay the lowest possible

prices, consistent with quality

and value requirement for

purchases materials

3.To minimize the inventory

investment

4.To operate efficiently

Basic principles of material management 1.Effective management & supervisionIt depends on managerial functions of • Planning• Organizing• Staffing• Directing• Controlling • Reporting• Budgeting2. Sound purchasing methods3.Skillful & hard poised negotiations4.Effective purchase system5.Should be simple6.Must not increase other costs7.Simple inventory control programme

Elements of material management

1.Demand estimation

2.Identify the needed items

3.Calculate from the trends in

Consumption during last 2 years.

4.Review with resource constraints

CONCLUSION

Material management is an important management tool which will be very useful in getting the right quality & right quantity of supplies at right time, having good inventory control & adopting sound methods of condemnation & disposal will improve the efficiency of the organization & also make the working atmosphere healthy any type of organization, whether it is Private, Government ,Small organization, Big organization and Household.

Even a common man must know the basics of material management so that he can get the best of the available resources and make it a habit to adopt the principles of material management in all our daily activities

:-IMPORTANCE:-OBJECTIVES:-FUNCTIONS

:-FACTORS INFLUENCING PURCHASING POLICIES

PURCHASING

PURCHASE MANAGEMENTPurchase management is not only buying, but

also includes the planning and policy activities covering a wide range of related and complementary activities.

IT INCLUDES THE FOLLOWING WAYS:- Research and development activities required

for proper selection of material and source.Follow up to ensure timely delivery.Coordination of activities of purchase

department with other department.Coordination with internal division of

procurement,traffic,receiving,stores and accounting.

IMPORTANCE OF PURCHASING

providing material of right quality, at right time and at right price.

1% saving in material cost is equivalent to 10% increase in turnover.

Purchase manager spends 50% funds of the company.

Present concept is to buy more than to produce.Purchasing can contribute to import

substitution.It is responsible for timely implementation of

the project.Purchase management is important part of

materials management.

OBJECTIVES :-

Maintaining continuity of supply:- the purchasing function must ensure the continuous availability of materials , supplies and equipments to maintain production schedule.

Maintenance standards quality:- the purchasing function must ensure that the material purchased must be of required quality in order to produce the goods.

Avoidance of duplication ,waste and obsolescence:- the purchasing authority must have the accurate knowledge of the items in hand and the requirements for a particular period in order to have proper decision in view of long range and short range plans.

• Maintenance of company’s competitive position:- this is necessary to make sure that company’s quality standards are not lower than company’s close competitors.

• Maintenance of company’s good image:- the purchasing agent must create a good image in the minds of suppliers . This will help in purchasing operation and to discover new ideas and materials besides lowering its cost or improving products.

•Developing alternative sources of supply:- alternative sources of supply must be exposed for increasing the bargaining power of the buyer and minimizing the cost of purchases. Purchases can be made from alternative sources if a particular supplier fails to supply goods.

FUNCTIONS OF PURCHASING

There are two functions of purchasing department

:- PRIMARY FUNTION:- SECONDRY FUNCTION

PRIMARY FUNCTION :-• Obtaining prices• Selecting vendors• Awarding purchase orders• Follow up• Adjusting and setting complaints• Training of purchase personnel• Vendor relation• Inventory control

SECONDARY FUNCTION :-Scheduling order and deliveriesProper inspection and accountingMarket researchContract and agreementTransportation and tariffMake or buy decisionSales of scrap , salvage and surplus

Factor influencing purchasing policies

Buying behavior is influenced by:Cultural factorsSocial factorsPersonal factorsPsychological factors

AgeStage in life cycleOccupationEconomic circumstancesLifestylePersonalitySelf-concept

. THANK YOU . .