Materials Management

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What is Materials Management?

Materials management oversees and controls the flow of goods and services, and communicates information from suppliers to customers. It involves the physical movement of materials from point to point and the planning, purchasing, and storage of materials. Materials management also consists of overseeing the storage and handling of materials, waste management, inventory control, and tracking of materials.

Significance of Materials Management in Shipping and E-commerce

Materials management streamlines processes by providing businesses with better control over their inventory and supply chain. It can be helpful in the supply chain management system in the following ways:

1. Proper forecasting and planning of inventory requirements: Materials management enables businesses to accurately forecast and plan their needs, ensuring that the right amount of inventory is held for customer orders.

2. Optimizing storage and handling costs: It reduces storage and handling costs associated with the movement of goods by providing cost-effective solutions.

3. Enhanced customer service: Through materials management, businesses can ensure that their customers receive their orders on time, thus providing them with better customer service.

Prerequisites of Materials Management and How it Works

The procedure of effective materials management utilizes the steps mentioned below.

  • Inventory control: This involves tracking materials, issuing orders for replenishment, and ensuring the availability of materials when needed.
  • Supplier relationships: Maintaining good relationships with suppliers is a critical component of materials management.
  • Cost management: This includes optimizing the procurement process, minimizing waste, and minimizing unused inventory.
  • Quality control: It ensures that the materials meet the organization’s standards for quality and are safe for use.

Use Cases of Materials Management

A real-life example of materials management is the inventory control system at a retail store. The store tracks the number of items it has in stock, the price of each item, and the quantity of each item ordered by customers. The store uses this information to determine when things need to be reordered and how much inventory should be kept on hand. 

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