Material Management involves the planning, organization, controlling and co-ordination of flow of materials and related activities linked with material and inventory requirements, from the point we secure your contract or your purchase our service to end point of use- which can be the end life of your project or where we are contracted/ required to end the solution.
Materials management includes a number of key processes which includes: Inventory management, purchase management, value analysis, store keeping, maintenance and upkeep of the inventories in hand and in process.
WHAT WE DO CGREL LTD
At Chrysolite, Our material management solution, works in-hand with our procurement management to purchase the highest quality equipment and products at the lowest possible cost for your organization.
We also manage the inventory control functions, shipping and receiving, and also planning and administering department budgets, to ensure your project is on-point with it comes to this aspect.
TYPES OF MATERIALS
Generally, inventory types can be grouped into four classifications: raw material, work-in-process, finished goods and Maintenance, Repair, and Operating Supplies (MRO) goods. MRO induces materials like: Transit Inventory, Buffer Inventory, Anticipation Inventory, Decoupling Inventory, Cycle Inventory.
Raw materials are inventory items that are used in the manufacturer’s conversion process to produce components, sub assemblies, or finished products. These inventory items may be commodities or extracted materials that the firm or its subsidiary has produced or extracted. They also may be objects or elements that the firm has purchased from outside the organization. Even if the item is partially assembled or is considered a finished good to the supplier, the purchaser may classify it as a raw material if his or her firm had no input into its production. Typically, raw materials are commodities such as ore, grain, minerals, petroleum, chemicals, paper, wood, paint, steel, and food items. However, items such as nuts and bolts, ball bearings, key stock, casters, seats, wheels, and even engines may be regarded as raw materials if they are purchased from outside the firm.
The bill-of-materials file in a material requirements planning system (MRP) or a manufacturing resource planning (MRP II) system utilizes a tool known as a product structure tree to clarify the relationship among its inventory items and provide a basis for filling out, or “exploding,” the master production schedule. Consider an example of a rolling cart. This cart consists of a top that is pressed from a sheet of steel, a frame formed from four steel bars, and a leg assembly consisting of four legs, rolled from sheet steel, each with a caster attached.
Generally, raw materials are used in the manufacture of components. These components are then incorporated into the final product or become part of a sub-assembly. Sub-assemblies are then used to manufacture or assemble the final product. A part that goes into making another part is known as a component, while the part it goes into is known as its parent. Any item that does not have a component is regarded as a raw material or purchased item. From the product structure tree it is apparent that the rolling cart’s raw materials are steel, bars, wheels, ball bearings, axles, and caster frames.
Work-in-process (WIP) is made up of all the materials, parts (components), assemblies, and sub-assemblies that are being processed or are waiting to be processed within the system. This generally includes all material—from raw material that has been released for initial processing up to material that has been completely processed and is awaiting final inspection and acceptance before inclusion in finished goods.
Any item that has a parent but is not a raw material is considered to be work-in-process. A glance at the rolling cart product structure tree example reveals that work-in-process in this situation consists of tops, leg assemblies, frames, legs, and casters. Actually, the leg assembly and casters are labeled as sub-assemblies because the leg assembly consists of legs and casters and the casters are assembled from wheels, ball bearings, axles, and caster frames.
A finished good is a completed part that is ready for a customer order. Therefore, finished goods inventory is the stock of completed products. These goods have been inspected and have passed final inspection requirements so that they can be transferred out of work-in-process and into finished goods inventory. From this point, finished goods can be sold directly to their final user, sold to retailers, sold to wholesalers, sent to distribution centers, or held in anticipation of a customer order.
Any item that does not have a parent can be classified as a finished good. By looking at the rolling cart product structure tree example one can determine that the finished good in this case is a cart.
Inventories can be further classified according to the purpose they serve. These types include transit inventory, buffer inventory, anticipation inventory, decoupling inventory, cycle inventory, and MRO goods inventory. Some of these also are know by other names, such as speculative inventory, safety inventory, and seasonal inventory. We already have briefly discussed some of the implications of a few of these inventory types, but will now discuss each in more detail.