THE IMPACT OF MATERIAL MANAGEMENT ON PURCHASING

THE IMPACT OF MATERIAL MANAGEMENT ON PURCHASING

CHAPTER ONE

1.1      Introduction

Material Management was first discovered as very important function during the Second World War. After industrial revolution industries are sprining up in hundred everyday activities, raw materials and scare, production has become complex and the number of goods, components and raw materials have increased to thousand account head to be prepared and customer need to be attended to writing a short period of time. Alternative sources are required and new product need improvements and development with these problems in minds materials management in modern industries intends to have stated an attack these problem in a scientific manner to achieve optimum sources hence professionalism. With the introduction of materials management into modern industries, the following advantages have accrued.

i)  High sales

ii) Good records

iii) Low cost of requisition and processing

iv) Constituency of qualities

v)  Favourable supplier relations

vi) Good storage facilities

Thus, the importance of materials management lies in the fact that any significant contribution made by materials management in reducing material cost will go long way in improving profitability and the rate of returns on investments. Today, material are the live hoods of any industries. No industrial concern can operate without them. They must be made available at the proper place, right source, right quality and at the proper price.

1.2   Objective of the Essay

The objective of the essay is to look at the significance of materials management on utilization source in manufacturing.

The objective of the study are as follows:

i)   To discover problem facing store management in an organization.

ii)  To discover and encourage the use of new techniques in the management in an organization.

iii) To determine the methods of coordinating its activities so that each function form an integral part of the whole organization.

iv) To estimate the degree of contribution of material planning to the efficiency of the organization performance.

v) To identify the various techniques used in solving various and problem that occurs in the organization so that corrective actions can be taken to achieve the goals and objectives.

1.3   Significance of the Study

Is a paramount important for researcher on the significance of the study and dope this extended essay will be of great important to store managers in an organization. Which will be given in this study will go a long way to assisting the organization to improve their operation effective application of capital, human and material resources in the store department are no longer on option but a necessary pre-requisite survival and realization.

i)  And also serve as pre-requisite for the award of National Diploma (ND) in Business Studies.

ii) To serve as reference for the store personnel, lecturers and students of various institutions for more information about material management.

Solution in the industry to take necessary corrective and realistic measure of materials. It will show the impact of in and organization efficiency and performance.

1.4  Scope of the Essay

The scope of essay will be centered on the material  management on purchasing. As a result of idea on material management, which cover a wide area, the project term intend to look into affair of the organization on material management and resource utilization from the past fourteen years 1992 to 2004. This research is restricted to specific area of materials management including invoice, Local Purchasing Order (L.P.O) purchase requisition note Bin Card, job order and form M. This study cover the area, such as impact of materials, material handling etc which is the responsibility of management for the compute flow of materials to the satisfaction of users department in an organization.

1.5      Definition of Terms

Materials: In an industry it mean everything which is supplied to the production lines and so includes raw materials, components, sub assemblies, liquids powerest.

Organization: Is the grouping of related activities together and assigning those various activities or duties to various employees while at the same time giving them authority to perform those task.

Raw Materials: These combines all form of material that has to be converted into an end product.

Purchasing: Is the activity directed to securing by legal means, the materials suppliers, services and equipments required in the operation of an enterprise.

Quality: Is the totality of failures and characteristics of a product and services that bears on us ability to satisfy a given need.

Quantity: Refers to the value or amount of commodity required for a particular purpose or that can be economically purchased at a particular time.

Management: The word ‘management’ can be defined as control of human activities directed toward specific standard, which can be realized through the availability of resources such as men, machine, material and land.

Materials Management: Is the activities are frequently hand led by the local or officer level and involve regular communication with the suppliers concerning requirement such as order quantities and delivering data.