CHAPTER ONE
1.0INTRODUCTION
Stores have been considered as the livelihood of industries in both private and public sectors of the economy. Without stores, there could be neither production nor operation of any kind. Manufacturers are constantly conscious of the significant role of stores with regards to availability of raw materials and need for effective warehousing of their finished products. Occasional stock-outs can lead to production stoppage and hence a substantial loss of anticipated profits.
Cater R. J. in his book “Store Management and related operation” defined stores as a small/large building or an area (stockyard) in which all kinds of materials tools, spares and so on needed for production, distribution, maintenance, packing, servicing are stored until when required by the users or consumers.
Isola, O. T. define the term stores as the building, or room or place where materials are kept.
Apart from the fact that store is used to refer to buildings holding goods, it may be used to prescribe goods held in such a store house or stockyard. The goods may include finished goods awaiting dispatch as well as partly finished goods (W.I.P) awaiting completion (inventory management).
In “management of stores Activities” store management is defined as the act of keeping goods and materials, which have been produced by an individual or group, making it available as it when needed so that the objective can be met.
Aremu S. S. in his book “Modern store Administration” defined store keeping as an act or process of receiving, inspecting, recording, arranging and storing all kinds of materials, tolls, stores, equipment etc, needed for production, distribution, maintenance, packing servicing until when required by the users or consumers. The above definition shows that store – keeping should contribute directly to profitability and be concerned with lead time, storage cost, acquision cost, material handling, work study in store, preservation, packaging, pre-selection and issue packing and dispatch.
This chapter essentially discusses the conceptual frame works, purpose of study, store functions in an organisation, types of stores, stores organisation and relationship between stores and other major organisation departments.
1.1 PURPOSE OF THE STUDY
The reason behind this study is to enlight both the public and private sectors” store personnel on how to achieve adequate and proper store management. One of the major problem of this great country is material procurement which lack adequate store management and organisation.
1.2 STORES FUNCTIONS IN AN ORGANISATION
Store provides its function to all other departments within same industry especially the operative department.
(a) Store Controls in most industries upward 50% of a working capital.
(b) Because it controls large amount of working capital, its inefficiency will cause an organisation to liquidate (i.e run out of cash).
(c) Proper store-keeping is a safeguard against deterioration obsolescence, obsolete materials and theft, and fraud.
(d) Efficiency system of stores accounting helps in the preparation of dependable budgetary control for the organisation.
(e) Immediate provision of required materials, on presenting proper authorized documents.
(f) Determination of movement of materials is achieved i.e issues and records.
(h) Security of stores is ensured.
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