William A. Nevill
Grinnell College Grinrell, Iowa
Automated Inventory Control at the Small College
The inventory problem of the small college has always centered around the apparent need to purchase in bulk to obtain suitable discounts; yet the items are disbursed in small lots to the students. This inevitably has led to one or two major purchases a year with the inherent difficulty of properly estimating exact need over the period. Several small colleges now negotiate long term contracts with a single supply house, thus avoiding the preparation of an annual bid list. At Grinnell this method of purchase has been combined with an inventory system based upon the simplest of data processing systems. This achieves a sizable time saving for the staff personnel concerned, and dollar saving for the college, and also improves the daily window service rendered by our stockroom. Difficulties of the Bid System
Proponents of an annual bid list contend that bulk buying allows sizable discounts. I n this day of franchised merchandise the supply house finds its extent of discount quite limited. In a recent typical bid list situation, bids were found ranging from $3791 to $4326 on items that had a catalogue value of $4217. Of course it is possible to carefully constmct a list to allow the supply house greater freedom. Such a recent list received an $800 low hid on items that had a catalogue value of $1800. Such lists are atypical and lead to gross overstocking of minor items. Usually a bid list that is returned with a 1&20y0 discount is considered acceptable. In order that merchandise let out on bid be received at a convenient time (usually the summer months), the list itself must be prepared by late spring. This means that each instructor is asked to organize his laboratory about a year in advance. Furthermore, it requires the department chairman to be a kind of sorcerer in order to anticipate the annual use of such items as tubing, corks, and bulk solvents and acids. This is perhaps the last vestige of alchemy left to us today. Unanticipated student breakage and unusual chemical demands combine with changes in laboratory design to force frequent purchases. On these nondiscounted items the department also pays freight. The annual savings through bid purchases are eroded away. The Contract Purchase System
In contrast to the bid system, it has been found that discounts ranging from 3&50% on non-franchised items are available on contract from the major suppliers in the Chicago area. An initial letter was sent from Grinnell to several suppliers, announcing an annual budget and an intent to select a single supplier for 670
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Journal o f Chemicol Education
all items normally available in its catalogue. Subsequent negotiation led to some general observations. Since most organic chemicals are fair traded, the main areas of negotiation are prices of inorganic chemicals, heavy chemicals, and non-franchised equipment. Also to he determined are length of contract, minimum dollar amount (if any) of a single order, frequency of orders, and treatment of emergency orders. All companies are willing to ship f.0.b. your institution. The supply houses calculate that the average department spends 60% of its budget on franchised items. Therefore, a discount of 50% on non-fair-traded items results in a 20% discount on total purchases. This is the upper limit of the bid list method. Thus, the college can obtain the same savings as by the bid method, but the contract extends the savings to cover all purchases made throughout the year. In addition, the purchases may be spaced to more adequately reflect true departmental demands. The contract in no way limits the ability to purchase directly from special suppliers (e.g., Cal Bio Chem) or major manufacturers (e.g., Varian Associates). Automation of Purchasing System
The establishment of a principal supplier is not necessary to the automation of a purchasing system but it helps. One long order list is better adapted to automation than several shorter ones. Under this system the inventory record card may also become the order card. Our system employs an IBM data processing complex common to many colleges which have introduced automation into their registration procedures. Standard IBM cards (Tabco 5081) are coded using the IBM 526 printing key punch machine. Sorting is accomplished by the IBM series 80 machine and printing by the IBM 402 accounting machine. A sample inventory card is shown in Figure 1. The actual cards have printing only on the top line, thus the cardis blank between numbers 58 and 74. This space, the inventory record section, is used for a handwritten weekly inventory (below). As shown in the figure, during the last month the supply of condensers has dropped from 12 to 9. The figure "4" a t the top of this section indicates a minimum stock number. When the supply reaches this amount the card is pulled and sent to the IBM center where it is used to print the order. Section 1-5 gives the quantity ordered (here, one case). The amount specified is based on the EDITOR'S NOTE:The response received by Professor Nevill to the note in the August 1965 issue [42, 423 (1965)l leads us to recognize that a wide interest exists in learning the details of n typical system of inventory control for chemical stockrooms. The article is presented here.
history of use shown in the inventory record section. The description section (7-37) is ample for all equipment. Certain difficulties have arisen with complicated organic names; however, suitable abbreviations have been adopted. The description section, together with the supplier-catalogue number section (3949), completely defines the item. In the present example the letter 9" (position 25) within the d e scription stands for "standard taper" and the letter "C" (position 42) indicates jacket size, length, and l4ldo size fittings. Position 42 on a card for a chemical indicates purity (e.g., P = practical grade). The supplier is noted in positions 39 and 40; his catalogue number is shown in positions 43-49. Cost is entered in positions 5%57. Section 75-79 contains the sequence number for this item. When our system was introduced we had about 2000 items. These cards were arranged alphabetically and numbered sequentially at 50-unit intervals. This allows 49 new cards to he filed between any existing card. Position 80 allows for identification of the item as equipment or general chemical. Other punches at this position identify staff members. I n this manner, with the information from section 75-79, orders may be printed in which the equipment and chemicals are listed separately and alphabetically within each group. ks a side benefit, each staff member may have a printed alphabetical list of the chemicals reserved for his research. These research chemicals may be stored without fear in the general storeroom (each bearing a "DO NOT USE" label) and their stock level maintained by the general inventory system. Under this system bulk chemicals are inventoried only in 5-gallon can lots. The minimum stock number is set so that a full 5-gallon can is always in reserve. Heavy chemicals are ordered in 10-case mixed lots.
Franchised items are also purchased in discount lots. Cards for items in these latter two categories are held until a discount lot is obtained. Minimum stock numbers are adjusted accordingly so a reserve is always on hand. Stockroom Window Service
At the beginning of each course a student is issued a check-out card on the front of which is listed the equipment in his laboratory desk. This card is retained in the stockroom, and the back of it is used to record additional items checked out of the stockroom. Also in the stockroom is a master sheet of sequence numbers with a 'Ldishursed" and "added" column. The sequence numbers are printed under the items location within the stockroom. When a student requests an item, the sequence number is noted as one obtains it from its position in the stockroom. This number is recorded on the back of the student's check-out card and a mark is made in the "disburse" column next to the sequence number on the master sheet. As a student returns an item or a new shipment arrives, marks go into the "added" column. At the end of each week the status of each sequence number is tallied and any change entered on the IBM inventory card (see Fig. 1). The tallying and posting procedure requires less than two hours a week. The check-out procedure is such that one person can easily service the three windows of our stockroom which accommodate about 60-70 students per afternoon. The author wishes to acknowledge the kmd assistance of Mr. C. F. Fugh, Supervisor of Grinnell's IBM Data Processing Service, in organizing this system and the helpful discussions of Prof. Jay Young of King's College, Wilkes-Barre, Penna., which led our staff to consider such a system as we have described.
Volume 42, Number 12, December 1965
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