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Materials management
the coordinating function responsible for the planning and controlling material flow.
Also known as distribution-/controll-/logistic- management
Work in Process (WIP)
Materials have to be stocked before being transformed into finished goods(Inventar). That process reduced the amount of time that inventory spends in production is a good way to reduce the costs.
Purchasing: Operative processing task
Logistic: Physical flow of material
Raw materials
basic material which is used in the primary production or manufacturing of goods (fuel oil for chemical and plastic industry, lumber for furniture, or wheat for bread)
Auxiliary materials
are part of the finished products, but only in small value and/or quantity (condiment in pastries or glue in furniture)
Supplies (operating materials)
are inventory items consumed in the normal functioning of an organization. They are not part of the finished products, but necessary for production machines (lubricant and energy)
Bought-in parts
already made parts by other manufacturers (mattress for beds, seats for cars)
Articles of trade
to extend the own line of product (beverages in a bakery)
Production plants
to replace older plants, to extend production capacity or to rationalize
Spare articles
due to amortization or to defect risk
Services
Immaterial goods (transport, facility management)
Information
important source for decision making at all levels and hierarchies in a company (information about products, markets, competitors). Partly generated within the company, partly from outside through market research institutes
Procurement
The business management function that ensures identification, sourcing, access and management of external resources
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