Materials Control: Definition, Objectives, Needs and Essentials

Material Control

The systematic control over the purchase, store and consumption of materials is what we refer to as Material control. It helps in maintaining a regular and very timely supply of materials by avoiding both over and under-stocking. It ensures that the right quantity and quality of materials is available to the organization at the right time.

It helps in reducing the wastage and losses of materials by maintaining their efficient purchase, storage and use in the factory. Its importance lies in its role in reducing the production cost and increasing the company's profitability.

Material controls aims basically at efficient purchase, storage and use of materials. The following are its main objectives:

1. Ensuring better quality of materials at adequate quantity at right time for efficient and undisturbed production of output. 2. Maintaining the cost of materials at the minimum level. 3. Purchasing materials at a reasonable and affordable price. 4. Minimizing the handling cost and time spent in the process of storing and consuming the materials. 5. Providing information about raw materials, their costs and availability to the management. 6. Protecting materials against theft, loss by fire and leakage. 7. Avoid obsolescence of materials by employing a suitable method of materials issue.

Needs of Materials

The aim of making efficient purchase, storing and consumption of materials necessitates material control. Every producing company is required to maintain a good materials control system that helps in facilitating efficient purchase, storage and consumption of the materials. The need for materials control system in the organization arises due to the following reasons:

1. Economical Purchase
   Manufacturing companies should buy high quality materials at the most economical price. An effective materials control system makes sure that better quality materials are purchased at the most economical price, which will finally help in reducing the total production cost.
   
   2. Minimum Investment
   Over-stocking of materials is undesirable to the organization because it increases the production cost. As a result, an effective materials control system helps in avoiding over-stocking of materials and, due to this, keeps the investment in materials to the minimum.
   
   
   
   
   3. Minimum Wastage
   An effective materials control system helps in carefully handling the materials to and from store houses by trained and skilled store keepers or workers. With the help of an efficient materials control system, the wastage and losses of materials to fire, leakage, theft and so on can be kept at the minimum. 
   4.Balance On Hand 
   An effective materials control system is one that provides the ready balance of materials on hand in terms of their value and quantity value always. The perpetual inventory control system always shows the physical movement of stocks of materials and their current balance in terms of value and quantity.
   

Essentials of Materials control
The main essentials of materials control are as follows:

1. There should be a proper co-operation among the departments that deal with material purchasing, receiving, testing, storing, production planning and accounting. 

 2. A proper perpetual inventory system, which reflects the physical movement of stocks as well as their current balance should be put in place. 

3. A good method of classification and codification of materials should be established. 

4. There should be a standard forms for order, issue, requisitions, return and transfer of materials. 

5. There should be adequate and carefully planned materials storage facilities in order to avoid losses from evaporation, damage, theft, pilferage, and deterioration. 

6. Stock of different levels should be fixed so as to ensure that there is no under and over-stocking of materials. 

7. The quantity or number of each type of materials that are to be ordered should be fixed so as to help in reducing the cost of ordering and carrying. 

8. There should be a good system of internal check in order to ensure that all transactions relating to materials are automatically checked.   

9. There should be a centralized purchasing department.