INVENTORY CONTROL• It is planning, ordering and scheduling ofmaterial.• Right quantity of material available at righttime.• Systematic control over purchasing, storingand using of material.
FUNCTIONS• Effective use of financial resources.• Protection against all material losses.• Proper calculation of cost of production.• Keep the ball of production bouncing.• Economies in purchasing.• Eliminates redundant inventory.• Keeping prompt delivery to thecustomers
SCOPE• Formulation of relevant policies• Determining economic orderquantity• Determining lead time• Minimization of material-handlingand storage cost• Ascertaining Safety Stock
MBASIC• Effective managerial time is spent on moreimportant materials.• Concentrating on all items will dilute the effecton all the control process.• MBASIC is a innovative control techniquewhich helps to achieve an effective inventory.• This analytical management tool enables themanagement to concentrate its effort forbetter result.
APPROACH TO DRUGS• It is an approach that utilises monthly datain the form of-value of consumption of each drug value of drugs in storage relative value of unit prices consumption patterns supply sources• It also reveals measure of inventoryimportance of each drug & provide the bestcontrol as per the investment.
METHODS OF MBASIC• There are some selective inventory controlmethods to have an effective control on theinventory.1. A-B-C Analysis2. V-E-D Analysis3. F-M-S Analysis4. S-D-E Analysis5. H-M-L Analysis6. G-O-L-F Analysis7. X-Y-Z Analysis
A-B-C ANALYSIS• Always Better Control• Technique is based on importance• Maximum overall protection• Checked & prepared weekly or monthlyCATEGORY1.A(High cost)2.B(Medium cost)3.C(lower cost)%OF ITEMS102070% OF VALUE702010
CLASSIFICATION OF DRUGS• On the basis of monthly consumption.• Individual drug with its monthlyconsumption is listed out.• List is rearranged in descending order.• High (A), moderate (B), low (C)consumption drugs are identified.• Exact cut-off for A-B-C classification willvary,depending on the situation.
CONT..A•Carefulcontrol•Topmanagement•Follow-updaily orweekly•No lead timeB•Moderatecontrol•Middlemanagement•Monthly•Can be leadtimeC•Normalcontrol•Lowermanagement•Once in 3months•Mostly leadtime
V-E-D ANALYSIS• Vital Essential Desirable• Applicable for spare parts• Based on price, availability• V items large volume of stocks• D items no stock• For V items of A classification
CLASSIFICATION OF DRUGS• On the criticality of drug• Criticality on the basis of recommendationsby a panel of doctors.• Doctors are interviewed and the collectedinformation is processed.• Degree of importance & controlprocedures reduces from vital drugs todesirable drugs.
CONT..V•Appears in allcategories•Stocked inabundance•Non -availabilitycan’t betoleratedE•Appears invital &essential•Stocked inmediumamounts•Can betolerated for2-3 daysD•Appears invital &desirable•Stocked insmall amounts•Can betolerated forlong period
F-M-S• Fast Medium Slow• Based on rate of consumption• Some stock have much higher annual usagevalue than others.• After doing cost analysis, stock items areseparated into three categories.• It has been designed mainly for wholesaleand distribution environment.
CLASSIFICATION OF DRUGS• On the basis of monthly consumptionpatterns of drugs.• No. of individual drug consumed in month islisted & its distribution studied.• Then drugs are classified as fast medium &slow moving.
X-Y-Z• Individual drug’s stock value at the month’send is listed.• Rearranged in descending order of value• X-high inventory value• Y-moderate inventory value• Z-low inventory value• This analysis reveals how extensively thedrugs have been stocked & their usage.
H-M-L• High Medium Low• Based on unit value & not the annualconsumption value• H- unit value > 1000• M- unit value 100 to 1000• L- unit value < 100
CLASSIFICATION OF DRUGS• On the basis of the unit price of drugs.• Each drug consumed monthly is listed withits latest price.• Distribution of prices is done for classifyingdrugs as high, medium, low cost drugs.• this analysis will enable the managementto design appropriate purchase procedures& decide to purchase the drugs.
G-O-L-F• Government –Open-Local-Foreign market• It is based on the basis of the source ofsupply• Drugs are classified according to thenature of supplier• Determines the continuity of supply, leadtime & payment procedures.• Quality,quantity & continuity of supply isbetter in open market.• Moderate lead time in govt.& long lead timein foreign market.
CONCLUSION• MBASIC analysis is-• To place orders frequently keeping thestock low for high value and more useditems.• To place orders less frequently keepingsufficient stock for low valued and lowconsumed items.