Stores relations with other functions


Stores, apart from Finance function, is one that comes in contact with all the major functions of any organization or business.

In its daily working , it is closely related to Purchase function that virtually feeds it with its Purchase orders and the user departments, on the other hand, which draw materials from it on daily basis. In addition, it is the Finance function which is fed by stores  many information on daily basis.

One of the major roles of Stores , in any business, is Inventory Control. This vital function of Stores, in itself , affects many functions of business by decoupling many activities and functions.

Stores serves all departments of an organization, but the highest degree of relations are between Purchase who feeds the stores, and Production whom the Stores supplies various materials.

Stores and Purchase:
The two functions of materials management, Stores and Purchase, are complementary to each other.
Apart from the close relationship that exits on a day-to-day basis in the purchase of various items of stores there are other important activities which can best be done by close cooperation between stores and purchase. These are :

  • Identification i.e. coding of material
  • Variety reduction
  • Inventory control value analysis
  • Salvaging operations etc.

  • Stores sends indents to purchase based on inventory levels determined in accordance with usage and delivery lead times
  • Correct specification writing, code numbers, mention of units (e.g. pounds instead of kilos) etc., are all vital in this regard
  • Determination of ‘lot sizes’ for purchase which should suit production requirements, transport, handling and storage space
  • Purchase informs stores of orders placed and stores in turn informs purchase of receipts, rejections, shortages, breakages, theft and loss, if any
  • Stores should inform purchase of changing production trends, slow or non-moving stock, obsolete or surplus stock, scrap, etc.

Stores and Production:
The production or the user department happens to be the main customer of stores. In production meetings, if stores is represented, coordination can be excellent. Any change in a production schedule needs to be communicated to stores to enable prompt corrective action.
After all it is Stores that has to cater to the needs of the user departments

Stores and Sales:
The strong relationship between stores and sales exists in the marketing scenario where Sales is the chief customer of the finished goods store.

The sales department wants to ensure stocks at all times and this might be a costly philosophy in terms of inventory holdings. Close cooperation and an integrated approach can increase profitability.

Stores and Accounts:
Usually the accounts department does all the stores



accounting ensuring a day-to-day working relationship.

Stores and personnel:
Selection of the right person for stores work and an adequate training in storage, preservation and accounting techniques is vital.




Read on ...more Stores topics

Inventory Control
Stores relationship with other Functions
Advantages of a Centralized Store
Responsibilities of Stores
Store Planning and Layout