# Material Control System
A material control system aims to manage material from purchase to consumption efficiently. Two angles are examined: its objectives and its requirements (the conditions needed to make it work).
## Objectives of a Material Control System
| Objective | Meaning |
|---|---|
| Minimising interruption in production | Keep all necessary materials available at all times so production never stops, even for low-cost items. |
| Optimisation of material cost | Reduce total material cost — purchase price, ordering cost and holding cost — while ensuring quality and reliable delivery. |
| Reduction in wastages | Avoid losses from poor storage, quality deterioration and obsolescence. (Production-related losses are managed by the production department.) |
| Adequate information | Maintain accurate records giving reliable material information, helping detect losses/pilferage and aiding production planning. |
| Timely order completion | Enable timely fulfilment of customer orders, improving goodwill and customer satisfaction. |
## Requirements of Material Control
| # | Requirement | Description |
|---|---|---|
| 1 | Department coordination | Coordination between finance, purchasing, receiving, inspection, storage, accounting and payment. |
| 2 | Purchase procedure | A clear purchase process to buy materials on the best terms after proper inquiry. |
| 3 | Standard forms usage | Standardised forms for orders, receipts and material issues. |
| 4 | Material budgets | Budgets for materials, supplies and equipment to ensure cost efficiency. |
| 5 | Internal check system | All transactions properly approved and verified. |
| 6 | Proper storage | Materials stored in designated areas with safeguards against damage or loss. |
| 7 | Perpetual inventory | A continuous inventory system with regular stock checks to know current quantity and value. |
| 8 | Stores control and issue | Timely issue of materials in correct quantity through a controlled store system. |
| 9 | Controlling accounts & records | Detailed and summary records of material cost, from receipt to consumption. |