STORE MANAGEMENT & CODIFICATION 1 VARUN VENUGOPALAN MD SAJID
Store Management: An Introduction 2 The term stores, storehouse, warehouse etc refer to the physical place be it a building or a room etc. where materials components, tools, equipment’s and other items are kept. Stores management is concerned with ensuring that all the activities involved in storekeeping and stock control are carried out efficiently and economically by those employed in the Store.
Function of Stores 3 Receive raw materials, components, tools, equipment’s and other items and account for them. Provide adequate and proper storage and preservation to the various items. Meet the demands of the consuming departments by proper issues and account for the consumption. Minimize obsolescence, surplus and scrap through proper codification, preservation and handling. Highlight stock accumulation, discrepancies and abnormal consumption and effect control measures. Ensure good house keeping so that material handling, material preservation, stocking, receipt and issue can be done adequately. Assist in verification and provide supporting information for effective purchase action.
Relationship with other Departments 4 The Production Department Stores Department must ensure that all items, materials and tools, as well as spare parts for machinery, are always available for continuous, uninterrupted production. Stores might also have responsibility for quality control and for inspection.
Relationship with other Department 5 The Sales Department Close liaison is necessary between the Sales and Stores Departments. There is no value in Stores holding stocks of items which the Sales Department cannot sell or items which Stores does not have. An adequate information, based on forecasts of future sales and trends, is required to assist in planning orders, setting stock levels, allocating storage space, etc.
Relationship with other Departments 6 The Purchasing Department Stores must keep Purchasing up to date with information about stock levels, whilst Stores relies on Purchasing to buy all the items and materials needed by the enterprise for its operations. The Maintenance or Engineering Department This department relies on Stores to have available all the spare parts, tools, equipment and materials required for maintenance. In return it must supply full information to Stores of all long-term and short-term maintenance plans and the items which will be needed.
Relationship with other Departments 7 The Accounts Department This department requires information from Stores about the value of stock held, about any damages or losses, about the receipt of items for which payment has to be made, and about stock issued for various operations, processes or contracts, etc.house
Codification 8 It is one of the functions of stores management. A process of representing each item by a number, the digit of which indicates the group, the sub-group, the type and the dimension of the item. Describes an item in short, thus avoiding long statement every time the need to describe the item arises.
Objectives of Codification 9 Bringing all items together. Enable putting up of any future item in its proper place. Classify an item according to its characteristics. Give an unique code number to each item to avoid duplication and ambiguity. Reveal excessive variety and promote standardization and variety reduction. Establish a common language for the identification of an item. Fix essential parameters for specifying an item. Specify item as per national and international standards. Enable data processing and analysis.
Basis of codification 10 Who will be the user? To what use is the codification going to be put? What kind/degree of mechanization will be needed to use the codification system?
Codification by Group Classification Based on ‘shape’ of items 1. Wire 2. Tubing 3. Rod 4. Bar 5. Sheet 6. strip
Methods of coding of materials 12 Alphabetical method Numerical method Alphabetical-cum-Numerical method
Alphabetical method 13In this method first alphabet letters are used for codification of eachcategory of materials. For example, steel wire is coded as SW or steamcoal is coded as SC etc.
Alphabetical-cum-Numerical method 14 In this method, a combination of these two methods is used for coding of materials. For example, a steel wire of gauge 4mm quality A stored in rack/bin No.22, is given the code number SW4A/22. Such a method gives exact information than any of the above two methods.
Numerical method 15This method is used where materials accounting is to be mechanized byuse of punched cards or computers. For numerical coding a list isprepared for various departments and allotting to each of them asuitable number. The first two digits of the code number represent thedepartment for which the materials are meant and other two digitsstate the name of material as mentioned in the standard list ormaterials manual. For example, if code is 2341 it means Material No.41[copper wire] is to be used in Department No.23.
Codification of Raw-Material1 9 99 99 Raw-Material Generic Group e.g. Magnesite, Alumina Sub-Generic Group e.g.Fused Mag, Fire clay Running Serial No. e.g. 01
Codification of Generic Item2 99 99 999 Item Type e.g. Stores Generic Group (00-70) e.g. Bearing, Switchgear Sub-Generic Group e.g. Ball Bearing Running Serial No. e.g. 201
Codification of Drawing/ Part No. Item2 99 99 999 Item Type e.g. Stores, Service Generic Group (80-98) e.g. Casting, Fabricated Sub-Generic Group e.g. Equipment Code Running Serial No. e.g. 001
Codification of Capital Equipment2 99 99 999 Item Type e.g. Stores Generic Group (99) e.g. Capital Equipment Equipment Class e.g. Mixer, Press Running Serial No. e.g. 001
Codification of Service Items3 9 99 999 Service Item Type of Service e.g.Transportation, AMC Sub-Group e.g. Truck Load, Trailor Running Serial No. e.g. 001
Codification of Secondary Products4 9 99 99 Secondary Products Major Group Mining Pdt, Metal Scrap Sub-Group e.g. Clay, Ferrous Scrap Running Serial No. e.g. 01
Advantages of Codification 22It enables systematic grouping of similar items and avoids confusioncaused by long description of items since standardization of names isachieved through codification, it serves as the starting point ofsimplification and standardization. It helps in avoiding duplication ofitems and results