The Research On Cost Control Of Engineering Materials Based On System Dynamics

The cost of project material occupies60%-70%in project cost.Therefore theengineering material cost control is the key point of construction cost control.However the enterprises of our country universally existence the following problems,such as: material management system behind,the low level of information and thewaste of materials which lead to cost increasing and other problems. But most of thecurrent researches on the engineering material analysis just stay at the qualitativeanalysis stage, seriously effects the building enterprise healthy, and sustainabledevelopment. How to reduce the material cost, so as to realize the construction projectcost reduce is the focus of current research in the field of construction management.Through the establishment of system dynamic model for inventory and materialcost undertakes quantitative analysis, around the costs of project material, this paperuses a system kinetic (System Dynamics, referred to as SD) principle to do somerelated research work, including the:(1) Through the combination of domestic and foreign literature research, theengineering material in the construction industry and the importance of the materialcontrol problems, it gets the importance of strengthening the cost control ofengineering materials.(2) Based on the engineering project cost theory, elaborated the materialcomposition, influencing factors, characteristics and classification of the project cost,it analyses the common procurement forms of engineering materials and the inventorymanagement in the quantitative inventory management and periodic inventorymanagement.(3) Based on the theories and methods of system dynamics, it established thecausal diagram between engineering materials cost and project schedule, cost, quality;it proves the importance of the material management in engineering. Then from thematerial cost point of view, it established the causal diagram of the total costengineering materials.At last according to the analysis of feedback loop and causetree, it provided the purchase quantity can balance all the cost.(4) Using the reinforced material as the research object to carry on the empiricalresearch, it established reinforced quantitative management system dynamics model.Through changing the parameters of purchase delay time and safety inventory, itsimulated the inventory and storage costs. By contrasting, it got that reachedimplement inventory management by suppliers can better cost savings. Basing on the engineering total cost of material causality diagram analysis, it built project total costof material flow diagram of system dynamics. Through the change to observe theeffects of other variables, so as to find out the optimal purchasing quantity.In this paper, the knowledge of the system dynamics is introduced into the costmanagement of engineering materials. Through establishing the SD model ofengineering materials inventory management and the total cost, which provides a newidea for breaking traditional management of cost control of engineering materials.