Store Keeping

Meaning of Storekeeping

Storekeeping is a specialized and important function of material control that is especially concerned with the materials and material related goods. The storekeeper is responsible for safeguarding and keeping the materials and supplies in proper places until required in production.

It is service function and the storekeeper is incharge of storekeeping. He is the warden of the goods stored in the store and maintains a record of all movements of materials. The storekeeper, in fact, is a connecting link between planning and the production department. Purchasing control must be matched by effective stores control to avoid losses from damage, deterioration and carelessness.

Objectives of Storekeeping

Store keeping includes the handling and recording of materials. Following are the main objective of storekeeping:

• Effective use of available store space.

• It avoids over and under stocking of material.

• Efficiently and economically receiving a material, handling and issuing of stores.

• Protecting goods stores against fire, loss, theft, and obsolescence.

• Ensuring an adequate and timely supply of stores under proper requisition and authorization.

Types of Stores

Although, there are various types of store, the following are the commonly used by manufacturing company. Basically, there are three types of stores as follows:

1. Centralized stores
2. Decentralized stores
3. Centralized stores with Sub-stores

Centralized Stores:

If there is only one store to receive and issue materials to all departments of concern, such store is called centralized stores. In this type of store, all materials are stored in one place called a central store. Materials are received by and issued from one store's department in centralized stores.

This type of store is used by most of the manufacturing company. The main objective of a centralized store is to purchase and issue all the materials required by all the department.

Decentralized Stores:

This store has emerged due to disadvantages of centralized stores. It is a just reverse system of centralized stores. Under this system of a store, in each department, there should be an independent or separate store. Each department has to make a separate store for recording the materials they required. It is not so popular because it required more installation cost and a separate store in each department.

Centralized Store with Sub-Stores:

In this store, the imprest system of stores is used where each sub-store is given some beginning stock. In a big organization, the central store is far from production department and due to which transportation cost increases. To reduce the cost of handling and transportation, a sub-store is maintained near production department and sub- stores are managed by central stores. Sub- store gets materials from the central store.

Location of Store

The place is known as location. So, a location of the store means the place where the store is situated. While selecting the location of the store, purchase department must be careful in various facts because the location of the store must be considered and the store should be divided into racks which should be future sub- divided into small spaces. This space is known as a bin.

Factors to be considered for Selecting Location of Stores

• It should be located at a central and safe place.

• It must be located near to production department.

• It must have enough space to keep the purchase materials.

• It should be easily accessible to all the other department.

• It must be equipped with enough bins and racks.

Storekeeper

A storekeeper is a person appointed for taking care of the store. He is in charge of the store and responsible for the control of the store. Normally, all the big manufacturing concerns appoint a storekeeper. He has an important role in storekeeper. The storekeeper must have some technical knowledge and experience in store routine. Except this, he should be trained, honest, loyal and responsible. He is also called store manager or store superintendent.

Duties and Responsibilities of Storekeeper

A storekeeper should be responsible for the following functions:

1. Avoiding damage and deterioration of goods
2. Providing security against loss, fire and accident
3. Performing checking function on work completed
4. Protecting against the consequences of non-availability of materials
5. Recording and receiving of materials in store
6. Classification and codification of items which is received by store
7. Prohibited unauthorized persons from entering the store

Store Keeping Procedure or Store Routine

After receiving materials by receiving or store keeping department, storekeeper has to perform various jobs relating to materials. It is known as storekeeping procedures or store routine.

• Classification and codification of Materials
• Recording of Materials received
• Issuing of Materials

Classification and Codification of Materials

Classification and codification of materials facilities prompt identification of the materials in storage when they are being sent to production departments. All items in the stores should properly be classified and codified. Goods and raw materials which are received by store must be scientifically classified and coded.

• Classification of Materials

As per the nature of materials facilities in various groups of goods, materials are classified to make issuing, storing and identification materials easily and quickly. So, materials are first classified on the basis of their nature and types. It may be defined as construction, materials consumable store, spare parts, lubricating, etc.

• Codification of Materials

After classification of materials in various groups, they are codified again. Coding means to give numbers or distinctive symbols to specific materials of stores with an arrangement for a prompt arrangement to facilitate storing. The symbol allotted to the materials known as ‘code’.

There are three methods of codification of materials:

1. Alphabetical: Alphabets are espically used for codification of each group of material. For e.g. A, B, C…..
2. Numerical: Numbers are used for codification of each group of material. For e.g. 101, 102………
3. Alpha-Numeric: Both alphabets, as well as numeric, are used for codification of each group of material. For e.g. A-101-102…..

Recording of Materials Received

After classification and costing of materials, the next step in store routine is recording of materials received by store department. Following are the two system of material recording received by store.

1. Bin Card
2. Store Ledger

• Bin Card

The bin is the term used to symbolize the place or shelf or rack or pigeon-hole or even a big room where materials are stored and the card attached to the bin or tag hung up there is known as Bin card. Bin card shows quantitative details of receipt, issue and balance of materials in the bin.

This card also shows the maximum level, minimum level and re-order level of the materials. It helps the storekeeper to control material. Bin card is used by the storekeeper to keep the only quantitative record for all the items of materials in store. Remember that, it does not record the value of materials.

• Store Ledger

Store ledger is maintained by costing department. This ledger shows the information for the pricing of materials issued and the money value at any time of each item of stores. Store ledger contains an account for every item of stores and makes a record of the receipts, issue and the balance, both in quantity and value. It contains the name, part number of the item and bin number.

References:

Koirala, Madhav et.al., Principles of Accounting -XII, Buddha Prakashan, Kathmandu

Shrestha, Dasharatha et.al., Accountancy -XII, M.K. Prakashan, Kathmandu

Bajracharya, Puskar, Principle of Accounting-XII, Asia Publication Pvt. Ltd., Kathmandu