ABSTRACT
The stock control office was provided with accurate records of stocks, receipts and despatches from the Hollerith department, and stock cards for each line were reviewed systematically by stock clerks, who submitted the recommended despatches to the buyers. The marginal cost of placing an order for up to 25% more orders was estimated, based upon clerical costs in the buying office, warehouse control office and bought ledger office. The marginal cost of storing up to 25% more stock was estimated, based upon interest on capital invested in stock, insurance costs, storage costs and obsolescence and depreciation. The value of the safety stock at different levels of customer service was estimated from a series of calculations using statistical short-cuts. The best industrial engineering practices had been employed in the design and lay-out of the warehouse, and the various operations were assisted by the effective application of work-study to provide labour cost-control information and to apply incentive schemes for the operators.
