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Unit 4: Material Control

4.1 Meaning and Definition of Material Control Notes

The success of any industry or enterprise depends, to a greater extent, upon the successful control
of material. Further, this input provides a number of avenues and wide scope for improvement of
overall performance of the industry. Inventory control, therefore, aims at ensuring the availability
of required quality material in required quantity, at required time or period and place with
minimum cost. Inventory involves investment of money and locking up of precious space which
has alternate uses. It is said that inventory is a necessary evil. As a result, proper control has to
be exercised over it. In controlling inventory, firms or industries use a number of techniques and
models. Inventory control is generally exercised over raw materials and work in progress. The
basic purpose of inventory control is to maintain optimum level of inventory.
The objectives of material control are as follows:
(i) Proper estimation of inventory requirements-quantity, quality, specifications of inventory,
etc. This will help the purchase manager to quality and quantity of materials. The purchase
department has to exercise utmost care to procure the quality materials at lower prices.

(ii) The stores department has also an effective role to play for stock levels. By keeping only the
required quantities of materials, excess employment of capital on materials can be avoided.
Further, it can reduce the loss of materials during the storage period and keep the materials
in good condition.
(iii) It is the production departments which are capable of extracting the maximum output
from each unit of materials thereby contributing heavily to minimize the loss of materials
during the production period and to maximize the productivity.

Self Assessment

Fill in the blanks:

1. The basic purpose of inventory control is to maintain ……………………
2. Inventory control is generally exercised over raw materials and ……………………
3. The purchase department has to exercise utmost care to procure the quality materials at
……………………

4. By keeping only the required quantities of materials, excess employment of ….…………
can be avoided.

4.2 Methods and Techniques of Material Control

Material control is a systematic control over the purchasing storing and using of material to
minimizing the possible cost. In every manufacturing concern materials constitute an important
factor of production. It is an important element of cost & covering 60-70 percent of the total cost
of the production.
Material control may be defined as the level of material maintenance so as to ensure uninterrupted
production and minimizing the investment of funds.

Thus material control is the proper control of material which reduces the cost of production,
minimizing the investment of fund in the purchases of material & increases the profitability of
the organisation.

This technique of material control is helpful in avoiding overstocking and under stocking of
materials in store. The stock levels are fixed by the purchase manager and it is the duty of
storekeeper to observe them. In order to requisition the stores for replenishment, the store-keeper

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