Materials management is the component of a manufacturing company’s supply chain in charge of managing and controlling the flow of materials used in production.
While some firms combine it with procurement management, others see it as a separate entity that serves multiple sections of a business.
In the case of the former, materials management includes all aspects of sourcing and purchasing materials. You may learn more about this on our purchase management page.
When materials management is considered individually, it becomes a connection between procurement and production, primarily dealing with material requirements planning, coordinating material deployment and replenishment, and performing quality control and inventory analysis for direct materials.
In any scenario, the materials manager must work closely with inventory, procurement, and production personnel to establish methods for conveying material requirements and distributing raw materials across the supply chain.
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Best Materials Management Practices
Set Material Requirements And Quality Criteria
When it comes to quality control and procuring raw materials, the materials manager is the ultimate decision-maker. However, because the materials manager cannot oversee every purchase process and quality check, they must establish standard operating protocols that all participants must follow. This involves establishing material specifications and quality standards. This is the foundation for increasing product conformance while decreasing nonconformity.
Conduct Frequent Quality Inspections To Guarantee Standard Compliance
Effective quality control begins before the manufacturing process. Of course, no organization can analyze the quality of every unit of raw materials received, but quality control tests should be performed on a regular basis, as frequently and completely as is financially feasible. In most circumstances, failures owing to poor quality (particularly internal failures recognised by the customer, requiring returns, repairs, and so forth) are more expensive than efforts taken to assure excellent quality.
Understand The Precise Quantity And Location Of Your Direct/Raw Resources
You must know where and in what quantity the materials are in order to supply the manufacturing floor with the necessary materials at the appropriate moment. Every inventory must have the proper marks and structure. Physical counts should be performed on a regular basis to discover irregularities or misplacements, but technological methods should be employed to account for inventory on an ongoing basis.
Keep Track Of The Expenses Of Your Direct & Raw Materials Inventory
Direct material costs account for a sizable portion of the average manufacturer’s expenses. As a result, it is critical to ensure that surplus inventory is not tying up funds that may be put to better use elsewhere. Furthermore, keeping inventory for an extended period of time may result in perished or damaged items. This is especially true for items with an expiration date. Depending on the nature of their company, manufacturers should evaluate several inventory valuation methodologies (e.g., FIFO, LIFO, and Weighted Average).
Make A Plan And Stick To It
Material Requirements Planning (MRP I) and Manufacturing Resource Planning (MRP II) are two approaches to materials management that are closely connected.
While MRP I dates back to the mid-twentieth century and deals with fundamental production planning and inventory control (what and how much is required), MRP II is an improvement of this system.
MRP II, or Manufacturing Resource Planning, examines production planning with the addition of demand forecasts (when materials must be ordered) and capacity planning (when production can and should begin), as well as inventory control, purchasing, business planning, personnel requirements, and so on.
As a result, it enables improved machine and resource optimization, greater financial insights, and better management and coordination of production and stock.
Material Kitting Reduces Search Time
Material kitting is the process of combining the components of a BOM into a ready-to-use set before they arrive on the factory floor.
This method streamlines line-side inventory while improving picking speed, reporting, and quality control.
As a general rule, kitting would be most helpful when dealing with a huge variety of small components, bespoke goods with numerous characteristics, or a shortage of shop floor space that does not allow for significant line-side inventory.
Make Use Of Technology To Improve Process Efficiency
There are several technical options accessible to manufacturers and material managers to help them improve their business operations.
Barcoding, RFID, and IoT devices, as well as warehouse management software, let you manage and track your inventory.
A manufacturing ERP system, on the other hand, supports all areas of materials management as well as all other divisions of a manufacturing organization.
Conclusion
Material management is frequently considered a component of procurement, although addressing it individually and with greater concentration might result in higher quality and efficiency.
In a nutshell, the best practices for a materials manager to follow are connected to quality control and material flow.
It is advised that inventory control strategies such as safety stock and reorder point, or Just in Time, be used in conjunction with technical solutions that help in material tracking and assessment in order to accomplish seamless production with minimal bottlenecks and failures.
