What is Raw Materials and Their Types

Understanding Raw Materials and Their Types
In the industrial world, raw materials cannot be separated from them. Raw materials cannot be separated from the industrial world because every product that comes from industry must be produced from the best raw materials.

Raw materials are not only used in large industries, but can also be used in home industries. However, usually raw materials are often associated with large companies.

Raw materials in the industrial world are the most important factor in the sustainability of an industry. An industry that does not have raw materials cannot produce a product. Therefore, to maintain a smooth production process, raw material supplies must continue to be monitored properly.

Grameds, want to know more about raw materials? To find out more clearly about what raw materials are and the types of raw materials, you can read this article to the end. So, happy reading.

Understanding Raw Materials

In getting to know something, you should know its meaning first. Therefore, below we will explain several definitions of raw materials.

1. According to the KBBI

In the Big Indonesian Dictionary (KBBI) raw materials are materials to be processed through the production process into finished goods or basic necessities for making something.

2. According to Sofjan Assauri

Raw materials are all production materials which include all materials used in a company, except for various kinds of materials that will physically be integrated into the products produced by a company.

3. According to Hanggana

Raw materials are materials that function to produce finished goods, these materials will be bound together or the production materials will become one with the finished goods. Apart from that, Hanggana also said that in a company it cannot be separated from raw materials and auxiliary materials because these two materials greatly influence the production process and production results.

Based on the definition of raw materials above, it can be said that raw materials are the main materials in a company and are really needed to produce or create a product.

Entrepreneurs who own large companies should know their raw material costs. This is because raw material costs will determine the progress of a company. Thus, spending raw material costs becomes crucial for company owners.

Raw materials that can be processed into finished goods will be useful for every individual, especially in carrying out daily activities. Therefore, companies must maintain the stability of raw materials so that finished materials can continue to be produced, so that each individual’s needs can be met.

Types of Raw Materials

Raw materials in an industry are divided into two types, namely direct raw materials and indirect raw materials.

1. Direct Raw Materials

Direct raw materials are the main materials in the production process that are needed by a company and are visible directly. With direct raw materials, the production process will run smoothly, so finished goods will be easy to produce.

In purchasing raw materials directly as soon as possible. Therefore, the costs incurred to obtain direct raw materials must be paid immediately so that the production process can be carried out immediately.

Thus, direct raw materials can be said to be very important main materials. So, if there are no raw materials, no finished goods are produced. If finished goods are not produced, it will result in a company experiencing losses.

Indirect Raw Materials

Indirect raw materials are materials that can help the production process, but are not directly visible in the finished goods produced from a production. If direct raw materials must be available in order to carry out the production process, then indirect raw materials do not have to be available and production continues. In other words, whether there are indirect raw materials or not, the production process will continue.

When purchasing indirect raw materials, it is best to find out first whether the raw materials are really needed by the company or not. If a company purchases excessive amounts of indirect raw materials, it can cause losses to a company.

In short, every indirect raw material is a companion material to the main raw material. Even though they are accompanying materials, indirect raw materials still have a role in the production process.

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