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Raw Material and Manual Labor

Concepts of Raw Material and Manual Labour

Students who wish to work in the manufacturing sector or who aspire to become entrepreneurs in the future are introduced to terms and concepts that are related to manufacturing, in the management or other technical courses that they pursue. All concepts are related to each other and function as one whole, yet, it is necessary to understand each concept in isolation. Hence, while talking about manufacturing of products, a term commonly used is raw material.

Raw material - Raw material is the material used for manufacturing products. For example, cotton is the raw material for making cloth. Raw materials can be natural materials in the same form as they occur in nature or they may have to be altered before they are used for producing something. Direct raw materials are those that are used directly in manufacturing, like wood that is used for making furniture. Indirect raw materials are those that have to be processed for further manufacturing of products. For example, lubricants are used for oiling machines that is in manufacturing facility. There can be no manufacturing without raw material.

A company must have enough stock of raw material. Stock refers to the amount of raw material that is yet to be processed. It is a valuable asset of the company. It is reflected as a current asset in the balance sheet.

Manual labour - Another term associated with manufacturing is labour. Manual labour is the work done physically by human beings as opposed to work done by the machines. It refers to the physical as well as mental efforts used for the manufacturing of a product. It is a primary factor in the production process. Although there is law material available, somebody has to convert it into a finished product. This cannot happen without labour or machines. Cotton has to be spun into yarn and woven into cloth by someone, to produce the finished goods in the form of cloth. Even machines are operated by human beings. The colour combination, texture, thickness and design are results of the mental creativity and imagination of human beings. Hence, manufacturing is impossible without labour.

Manual labour can be skilled or unskilled. For example an electrician needs some skills and training to fit a fan in place. A person who carries loads on his back puts in sheer physical effort. Manual labour is a vital essence of human resource. The entire economics of the industry revolves around labour. Labour costs affect the prices of goods and eventually profits. Hence, raw material and manual labour are included in the curriculum as essential units of study.

Difficulties Encountered While Studying Raw Material and Manual Labour

Raw material and labour are two typically industry related terms. The concepts are not very easy to understand.

  • If concepts are not clear, students cannot identify which raw materials are direct and which are indirect.
  • Some materials may be finished product in one industry but may be a raw material in another industry. Hence, it is complicated and confusing for students. For example, lubricant oil is a finished product for a chemical industry but a facilitating material for an engineering firm.
  • There are different types of raw materials.
  • Understanding labour as a human resource is a difficult concept for beginners.
  • Students fail to differentiate between instances of manual labour and otherwise.
  • There are different types of manual labour.
  • The significance of manual labour and raw materials in the cost accounting procedure is the most difficult part to understand. Both are assets for the company and students must know what type of assets they are.
  • Calculation and estimations of profits depend upon raw material and manual labour and the expenses incurred on them by the company. Students fail to understand whether they are fixed assets or capital assets.

Help with Raw Material and Manual Labour Assignments and Homework

Students who study finance and accounts, manufacturing processes and any industry related courses are bound to come across the two terms - raw materials and manual labour. During the course, they are given a number of assignments related to the concepts. They are compulsory part of the course and carry internal assessment marks or grades. The subjects are new and difficult enough to scare students, especially those who have no commerce or mathematical background.

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