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Stores Management

 It is serving facility, inside an org.,


responsible for proper storage of the material
and then issuing it to respective departments
on proper requisition. The custodian of stores
is generally known as store-keeper or store
controller
 Those item which are not in use for some specific
duration e.g. spare parts and the raw- materials are
called as stores and building space where these are
kept is known as Store Room

“As per Maynard”


“The duty of store keeping are
“to receive materials,
to protect them while in storage from damage and
unauthorized removal,
to issue the materials in the right qualities, at right
time, to the right place and
to provide these services promptly and at least cost”
Stores System
CLOSED OPEN
2. All materials are stored in a 2. There is no specific area.
closed/controlled area. Stores are maintained in the
3. No other person than the form of suitable/ convenient
stores personnel is locations.
permitted in the area. 3. Every individual has access
4. Materials can leave or enter to any storage facility.
the storage area only by 4. After the receipt of the
authorized documents. material it is delivered to
5. Maximum physical respective department to
security. expedite the production
6. Tight accounting control of activity.
inventory material 5. Chances of pilferage high.
6. Less emphasis on
accounting control of the
material.
Functions of Store-Keeping
1. Receiving, handling and speedy issue of material.
2. Custodian of goods I store against damage and
pilferage.
3. To ensure regular supply of materials .
4. Effective utilization of store space.
5. To provide service to the organization in most
economical way.
6. To keep the details of the items available in store up
to date.
7. Proper identification and easy location of items.
8. Physical checking of stocks.
Objectives of Store-Keeping
 Easy location of the items in store.
 Proper identification of items.
 Speedy issue of material.
 Efficient utilization of space.
 Reduction in need of material handling
equipment.
Duties of Store- Keeper
 The items in stores shd. Be placed in such a
way that these can be easily located.
 To maintain the store premises neat and clean.
 Efficient and effective service to the org.
FUNCTIONS
 RECEIVING

OUTSIDE SUPPLIERS INTERNAL


SUPPLIERS
OUTSIDE SUPPLIERS
 On dispatching items, suppliers normally send an
advice note to the stores showing date of dispatch,
carrier details, description of the consignment and the
value of items. This ensures quick and easy clearance
of bills etc.
 The purchase copy, suppliers note and transporter
information/ consignment note enables the stores
manager to organize and plan for expeditious
clearance of materials and minimise cost
INTERNAL SUPPLIERS
 Whenever materials are received from internal
divisions or returned from user departments
transfer notes and returns to stores documents
are usually used for this purpose.
2. STORES SECTION
 This is a place where all materials received by
stores department are kept with protection
against deterioration.
 Various stores operation are:- LOCATION,
PROCEDURE LAYOUT EQUIPMENT and
IDENTIFICTAION OF STORES SECTION.
(a) LOCATION IN STORES SECTION:-
Stores are to provide space to the materials till
these are issued to the, respective
departments of the enterprise.
(b) Working Procedure:- The stores incharge
receives the materials from receiving
sections along wit goods inward note. The
material is classified and coded according to
their nature and use. For quick and easy
identification of the item’s category, a bin
card is tagged with each self.
Specimen of Bin Card
 Stores Bin Card
 Card No. Part No.
 Description Location
 Date IN OUT STOCK

The bin card contains upto date information


about the receipt, issue and balance of the
respective item in the stock.
( C ) Layout of Stores Section
1. Flexible in arrangement
2. Convenience in physical counting of
materials.
3. Efficient use of floor space and height.
4. Minimum handling and transportation of
materials .
5. Items used sparingly shd. Be easy to locate.
( D ) Stores Equipment
 A good store is equipped for handling,
measuring and weighing the materials. The
equipment should be such that stores invt. And
operating expenses are reduced.

(E) Materials handling Facilities:


There shd. Be proper weighing and measuring
instruments at the time of receiving and
issuing the materials
(F) Identification of materials in
stores
 Tagging some piece of paper or cloth with the
items.
 Labels may be fixed on the items.
 The coded number or any other identification
mark may be embossed on the items.
 Painting or colour coding of items.
Methods of Coding
 Mnemonic Method:- Here alphabets closely
associated with name of the item are used e.g. MT
can be used for some metallic item. This is useful
when few type of items are to be stored.
 Random Method:- Here both alphabets or numerals
can be used randomly. But the method is rather
arbitrary.
 Scientific Method:- The items are divided into
number of groups and each group is given some
code. Then further sub-grouping is done on the basis
of classification of item in any group, its shape,
function etc.
Location Coding
 The location can be identified in terms of the number of the
warehouse , row number, column number, rack number, shelf
or bin number etc. Location of any item inside the stock can
also be decided in three ways:-
 Fixed Location:- Here some fixed place is designated to each
class of item. The basis can be like Supplier wise, item wise,
utility of the item etc.
 Random Location :- Items are placed according to the
availability space in store at the time of receiving the items.
 Zonal Location:- like Bulk Zone, Reserve stock, indirect
material like spares and consumable items .
3. ISSUE SECTION
 It handles the issue of materials when required
by some department of the enterprise.
 Materials carry some money value and in
order to avoid malpractices and to curb the
tendency of waste, the items should be issued
against proper requisition.
 The material requisition is a request to the
stockroom to issue materials.
4. Accounting Section
 The accounts section exercises financial
control over stores. The goods receipt book is
maintained for all arrivals, making the receipt
in triplicate, a copy of which is sent to
accounts section and other to the store section.
5. Stock Taking Checking
 This implies physical checking of items in store to see that
these are in accordance with the entries of stores ledger.
METHODS OF STOCK CHECKING ARE:-
 FIXED ANNUAL INVENTORY:- A special team is deputed
to check and count the material inside the stores at the end of
each financial year.
 PERPETUAL INVENTORY:- In this system the stock control
department maintain upto date and systematic records of each
and every transaction. There is a system of continous
verification of stock. The entries on bin card and stores ledger
should tally with each other. In case of discrepancies thorough
investment is made.
Advantages of prepetual inventory
 There is no need to stop the production for checking
 No dislocation in stores operations.
 Checking is done in a systematic way, thus reducing
the chances of errors.
 Mistakes, discrepancies are spotted more quickly.
Important and expensive items can be checked more
frequently
 Facilitates the preparation of interim profit and loss
accounts.
 Avoids excessive inventory maintenance.