MATERIAL UTILIZATION SYSTEM IN MANUFACTURING ENTERPRISE(A CASE STUDY OF ASABA TEXTILE MILL LIMITED ASABA)

Material cost or inventory cost constitute large portion of total cost. Being one of the largest elements of cost, it therefore calls for a great emphasis on its full utilization. Every channel should be employed and exploited in ensuring for the maximum utilization of materials particularly in the areas of quality, quantity, prices and other attendant cost. The effective utilization of materials has been on ebbs hence the clamour for appropriate objective measures for tier maximum utilization. Abnormal wastage of material could cause a stock out and the effect. Excessive set-up cost, high ordering cost and processing cost. Therefore, the utilization of material for wealth maximization in any establishment calls for a great concern. However, to control the cost and enhance the effective utilization of material the following points are deemed relevant:- (a) Only the quantity of material and of the quality ordered should be accepted for production. (b) Ensuring that all materials ordered and paid for are actually received and used in production. (c) Proper and adequate physical control of material should be in extent in the firm. This minimizes pilferage and deterioration. (d) All issues from stores should be properly accounted for (e) Waste due to evaporation and power cut should be minimized (f) Giving workers adequate training and proper orientation use of materials and handling of machine should reduce scraps.