Our Company spends on an average of 1100 Crores per year for various capital works and maintenance works. Majority of these works requires different types of major and minor materials. Availability of the right material in required quantity at the right time is very much crucial. Non-availability of the materials not only delays planned works but also over burdens the existing network. On flip side, unplanned spending of such huge amounts directly impacts Company’s finances. Hence, proper material procurement planning is very much essential.
There are many techniques on which material procurement decisions can be taken. One such technique is consumption based procurement planning – where procurement decision of a material is taken based on its consumption history.