Inventory & Stores

What the daily routine used to look like

At 6:30 each morning the stores clerk arrives to find three clipboards hanging on the wire mesh gate. One is for yarn receipts from the spinning mill, another for grey fabric coming off the looms, and the third for finished goods ready to ship. She copies the previous day’s closing balances onto a fresh sheet, then walks the racks with a clipboard and pen, ticking off what she sees. If a dye lot is missing, she phones the dye-house supervisor; if a pallet of bleached towels is short, she calls the packing line. By 8:30 she has a handwritten tally that she transcribes into a shared spreadsheet. The production manager and accountant each keep their own copy, so by mid-morning there are three versions of the same numbers.

The afternoon is spent chasing signatures. A weaver needs 20 cones of 20/2 yarn; the clerk writes the issue on a triplicate form, has the weaver sign, then the shift supervisor, then the production manager. One copy stays in the stores file, one goes to accounts, and the third travels with the yarn to the loom. If the loom breaks down and the cones are returned, the clerk writes a credit note by hand and the whole cycle repeats. At month-end she spends two days reconciling the spreadsheets with the physical count; discrepancies are written off on a scrap sheet that the accountant later keys into the general ledger.

How a document moves through the system

Material Issue

The loom supervisor opens the Material Issue screen on his tablet. He selects the loom number, the job card, and the yarn item code. The system shows the current rack balance and the quantity reserved for that job. He enters the actual cones issued, taps “Save as Draft”, and the document sits in the stores queue. The stores clerk reviews it, confirms the physical stock, and posts it. Posting reduces the yarn store balance, increases the work-in-progress store balance, and writes one line into the stock ledger: date, item, quantity, cost, and the job card reference. The same line appears in the general ledger as a debit to WIP and a credit to raw materials.

Material Receipt

The dye-house foreman receives a batch of grey fabric. He scans the job card barcode, which opens a Material Receipt form pre-filled with the expected quantity and item code. He enters the actual metres received, any yield loss, and the dye lot number. The form is saved as draft and sent to the quality lab. The lab technician inspects the fabric, records the shade pass/fail, and approves the draft. The stores clerk posts it, which increases the dyed-fabric store balance and writes a single line into the stock ledger. The cost is calculated as the grey fabric cost plus the dye and labour costs already captured on the job card.

Stock Transfer

A pallet of finished towels is moved from the packing store to the finished-goods store. The packing supervisor raises a Stock Transfer document, selecting the source and destination stores, the pallet number, and the quantity. The document is saved as draft and sent to the finished-goods store clerk. She scans the pallet barcode, confirms the quantity, and posts the transfer. The system reduces the packing store balance, increases the finished-goods store balance, and writes one line into the stock ledger with the same cost but different store codes. No general-ledger entry is created because the value has not left the company.

Stock Adjustment

During the monthly stock count, the stores clerk finds two missing cones of yarn. She raises a Stock Adjustment document, selecting the item, the rack, and the quantity short. The document is saved as draft and sent to the production manager for approval. He reviews the CCTV footage, confirms the loss, and approves the draft. The clerk posts it, which reduces the yarn store balance and writes a single line into the stock ledger. The cost of the missing cones is posted to a scrap expense account in the general ledger.

Gate Pass

A truck arrives to collect 50 cartons of finished towels. The finished-goods clerk raises a Gate Pass, selecting the customer order, the cartons, and the truck number. The document is saved as draft and sent to the security guard. The guard scans the cartons, confirms the quantity, and posts the pass. Posting reduces the finished-goods store balance, writes a line into the stock ledger, and creates an accounts-receivable entry for the invoice value. The same pass can be used for returnable items such as pallets or dye drums; in that case the system keeps the stock in a separate “returnable” store and does not create a general-ledger entry until the items are actually returned or written off.

The reports and the decisions they support

What usually goes wrong without it

Negative stock is the first sign. A loom supervisor issues 20 cones of yarn, but the stores clerk’s spreadsheet shows only 18. She lets it go, and the next shift issues another 10 against the same balance. By month-end the spreadsheet shows minus 12 cones, so the accountant adjusts the general ledger to match, hiding the real loss. No one knows which loom used the extra yarn, so no one can investigate whether it was stolen, miscounted, or wasted.

Parallel records multiply. The dye-house keeps its own dye-stock spreadsheet because the stores clerk’s version is always a day behind. The maintenance department tracks spares on a whiteboard. When the accountant closes the month, she has to consolidate three sets of numbers, and the differences are written off as “stock variance”. Over a year these variances add up to enough yarn to run an extra loom for a month.

Reconciliation becomes a month-end ritual. The stores clerk spends two days counting every rack, the accountant spends another day matching the count to the general ledger, and the production manager spends a day explaining why the grey-fabric store is short. The write-offs are posted, the ledger is closed, and the cycle starts again. No one has time to ask why the same items are always short.

Working capital is invisible. The reorder level for a dye is set at 50 kg, but no one knows how much is actually in stock because the last count was three weeks ago. The buyer orders another 200 kg, and the dye sits on the shelf for six months. Meanwhile, a loom stops because the yarn store shows zero balance, but the physical rack still has 12 cones that were never recorded. The plant pays overtime to unload a rush delivery of yarn that was already in the building.

Traceability is lost. A customer returns a batch of towels because the shade is wrong. The stores clerk checks the records and finds that the dye lot was used on three different grey-fabric batches. She has to walk the racks, read the batch numbers on every pallet, and hope the labels haven’t faded. By the time she finds the matching pallet, the customer has cancelled the order.

Gate passes are paper and unenforced. A truck leaves with 50 cartons of towels, but the gate pass is unsigned. The security guard lets it go because the driver says the clerk is on leave. The cartons are never invoiced, and the finished-goods store shows 50 cartons that no longer exist. The accountant discovers the gap when the customer pays for only 40 cartons, and the missing 10 are written off as “dispatch error”.