The work is to design and develop efficient material handling system to reduce inventory for using it in the rear axle in an assembly unit. A concept was developed for Multipurpose Rear Axle Storage Trolley. In the conventional assembly plant, the system adopts two separate storage trolley for handling two rear axle models. This system has a considerable effect over processing time, storage space and cost. With the help of quality tools like cause and effect diagrams, control charts, in this work analyzed the causes for the problem that are present in the existing model. This process helped us in setting up counter measures for developing a new concept of Multipurpose Rear Axle Storage Trolley. In this new method, the two different types of rear axle models mounted on a single storage trolley by means which the problem prevailing in the existing method can be overcome in the proposed method.