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STORE

MANAGEMENT
NEHA SINDHAV
AKASH SHARMA

INTRODUCTION

The term store ,storehouse ,warehouse etc refer to the


physical place be it a building or a room etc where
materials of all variety are kept.
The function of stores is to keep ,receive and issue
materials.
Stores are normally divided into various section such
as:
1. receiving section
2. tool stores
3. general stores
4. raw materials stores
5. finished materials stores etc.

Stores play a vital role in the operations of a


company.

Stores network are incredibly complex and


therein lies the oppurtunity of improvement.

NECESSITY OF STORES

One must always remember that even though


store keeping doesnt any value to the product
in the normal sense , its is an essential
function and just cannot be wished away.
At time stores may add time utility or value by
preserving the scarce materialsthat may be
required in future.
By proper preservation and storage ,the store
department adds value of inventory.
The financial view considers the stores as an
overhead i.e: a cost with no return.

The cost of capital can be categorized into a


capital cost component and revenue
expenditure component.
The cost of capital of the sunk cost in land
building , roads , yards, materials handling
equipment and related facilities.
Because of the very irreversible nature of
this cost, proper planning of stores can go
long way in reducing this capital expenditure
that may also have a bearing on the revenue
expenditure in the stores.

FUNCTIONS OF STORES

To receive raw material components tools, spares,


supplies ,equipments and other items and account
for them.
To provide adequate ,proper and efficient storage
and preservation of all the items.
Arrange for inspection of incoming materials.
Ensure that good received note(GRN) are raised and
distributed without delay.
Issue materials to the consuming department against
authorised requisitions and account for the same
Maintain records of the up-to-date records of
material received ,issued ,rejected ,disposed and
quantity on hand of all the items.

The following are the principle functions of a


store:
Ensure that all documents relating to
receipts and issue are sent to stock control ,
accounts and other concerned departments.
Undertake the stock verification as per
approved procedure.
To minimise obsolescence, surplus and scrap
through proper codification and initiate
appropriate control action wherever
necessary.

STORES MANAGEMENT
(CENTRALISED AND DECENTRALISED)

A very big organization having a portfolio of numerous


products may have a huge main stores along with number
of smaller decentralized stores sections.
This arrangement does away with duplication of efforts in
common activities.
All items are kept in central stores to keep inventory at
optimum levels.
It is more a matter of convenience and suitability to the
operating enviornment than a question of choice of one
structure over another.
However the guiding principle has to be that overall stores
control has to be unified in the hands of the chief stores
officer for effective coordination with other interfacing
departments and proper internal control of stores.

ADVANTAGES OF CENTRALIZED
STORES:

Optimum level of service to user department.


Better internal control.
Single point delivery and single point
inspection.
Speedy communication with user department
and various suppliers.
Provides opportunities for standardization.
Probability of obsolescence is reduced due to
higher inventory turnover.
Avoid duplication of efforts.

DISADVANTAGES OF
CENTRALIZED STORE:

May create bottle necks in materials


receipt , incoming inspection and issues the
basic function of any stores.
Requires more internal documentation.
It may be sensitive to the needs of individual
user department.
May not be located at optimum location and
thus result in increased materials handling
and transportation costs.

STORES SYSTEM AND PROCEDURES

The stores function deals with three major


activities:
Receipt
Stocking
Issues
1.Receipt :

The receipt function is the last step in the purchasing


activity and first link in the stores function.
This deals with the function of receiving and
physically handling delivered materials ,and verifying
that the deliveries corresponds exactly the nature and
quantity as per purchase order.

Inspection:

inspection may be performed in the receiving section


or in place specifically demarcated for inspection
Methods of inspection:
1 visual
2 by touch
3 by smell
4 by comparison
5 by testing
Discrepancies:
Various discrepancies such as- loss of package , damaged
packages , shortages, damages to goods wrong items
supplied excess supplies.
Rejection:
Ifgoods are rejected fully or partially a rejection note is
raised and a copy is circulated to purchase section and
to supplier.

Stocking:
Materials are stored in the stock room and are issued to various
jobs or production departments against the authorised
materials requisition.
The issues are recorded in the stores ledger and the respective
job s or production departments are debited with the price of
the materials issued.

Issues :
The term issues implies the normal supply of materials from
stores to various user departments.
Efficient issue of materials from the stores is the benchmark to
judge the performance of stores function.

STOCK VERIFICATION

The stock manager holds the physical custody


of the materials and is responsible for safe
upkeep as well as for any major discrepancy.
He must constantly review the stocks and
reconcile the physical and book stocks ,which
differ in almost all organizations.
For ex-if the weighing scale indicates 1kg less
every time they weigh, and there are 100
weighing in a period the store keeper would
have issued100 kg without any records and find
himself short when the physical check is made
using the same weigh bridge.

THANK YOU

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