Objectives of Material Management


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Primary objective 

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  • low prices- to be lowest – includes transportation: enhances profit
  • high inventory turnover- value of inventories to be low in relation to sales. reduces storage costs
  • low cost acquisition and possession- reduced handling and storage costs.
  • continuity of supply- alternative sources, , captive suppliers, flexible suppliers
  • low payroll costs- low operating costs of material management personnel
  • favorable supplier relations- supplier development

Secondary objectives of materials management

New materials and products- working closely with design and research departments for development of new materials and products

Economic make-buy- coordinating and assisting other departments in make-buy decisions

Standardization- coordinating with design departments in reducing no. of items.

Product improvement- contribution towards product improvement by giving appropriate inputs and assisting design department.

Interdepartmental harmony- success of materials management department depends on the success of other departments. Hence relations are to be harmonious

Forecasts- forecasts in terms of prices, availability and general market conditions are to be regularly monitored towards taking important business decisions.

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We, at BMS.co.in, believe in sharing knowledge and giving quality information to our BMS students. We are here to provide and update you with every details required by you BMSites! If you want to join us, please mail to contact@bms.co.in.

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