The management and control of goods, The management and control of goods, services and equipment from acquisition services and equipment from acquisition to disposition.to disposition.

Since the materials are procured and kept in the store, the term Stores Management may also be used inter-changeably

Hospital - Hospital stores to the departments

Health Care - State central stores to the health facilities

Pharma Industry - Supplies from the stores to the production unit

Materials are a major cost factor in any enterprise. In health care system materials costs is 40%Salaries 60%

The aim of materials management in a hospital is to ensure that

◦ there is adequate stock of required items ◦ there is a continuous supply, ◦ there are no surplus, ◦ there is appropriate storage, ◦ items are easily retrievable, ◦ distribution to the point of usage ◦ effective and efficient utilization of available

resources.

Management is the function responsible for

the co-ordination of planning, sourcing, purchasing, storing and controlling materials in an optimum

manner so as to provide a predetermined services at the minimum cost

Non Consumable stores: Non Consumable stores: Those stores Those stores which can be used again and again.which can be used again and again.

Consumable Stores: Consumable Stores: Those stores which Those stores which can be used only oncecan be used only once

Surgical StoresSurgical Stores Medical & Drug StoresMedical & Drug Stores General StoresGeneral Stores Linen StoresLinen Stores Dietary StoresDietary Stores Stationery StoresStationery Stores Engineering and Maintenance StoresEngineering and Maintenance Stores

• Fast changing technology.• Increased number of diversified services• Increased in-patient & out-patient load• Customer expectations are high • Scarce resources• Demand & supply gap.

Increased expenditure on medical stores

“EFFECTIVE & EFFICIENT UTILISATION OF AVAILABLE RESOURCES”

• Identify items and obtain specifications of

items• Quantify the needs• Procure quality items at lowest cost• Ensure timely ordering of the items.• Ensure timely receipt consistent with quality & quantity.• Efficient system of distribution• Proper storage without deterioration.

How to Address…..??

• Improving the knowledge on cost awareness

• Optimizing resources • Balancing cost with quality.• What, when, how much to stock, how

much to order & how often?•

• Utilization of modern management tools & techniques• Inventory control.• Information system, • Performance improvement

• Equipment maintenance, • Condemnation and disposal of

unserviceable items

The basic objective to be achieved is un-The basic objective to be achieved is un-interrupted supply of items in wards and interrupted supply of items in wards and departments at reasonable cost.departments at reasonable cost.

It seeks to provide from a right source

Right materialsRight qualityRight quantityRight time

Primary Objectives: Low Purchase Price High inventory turnover Low storage cost Maintaining continuous supply Development of Vendors

Good Records

Secondary Objectives Favourable reciprocal relations Economic make or buy Standardisation Product improvement Economic forecast

Estimation of demand and purchasingEstimation of demand and purchasing Receiving and inspectionReceiving and inspection Storage Storage Inventory controlInventory control DistributionDistribution Disposal Disposal

DEMAND DEMAND ESTIMATING ESTIMATING

ANDANDPURCHASINGPURCHASING

DISTRIBUTIONDISTRIBUTION

STORAGESTORAGE

RECEIVING ANDRECEIVING ANDINSPECTIONINSPECTION

1. Materials planning and budgeting• Selection • Quantification

2. Purchasing◦ Codification◦ Standarization◦ Tendering system

3. Receiving and inspection4. Stocking and Distribution

Preservation of stores Pilferages MIS

5. Inventory Control

6. Cost Reduction◦ Utilization◦ Repair and maintenance

7. Value Analysis 8. Disposal

FUNCTIONS OF STORES FUNCTIONS OF STORES MANAGEMENTMANAGEMENT

This requires: ◦ need assessment ◦ specifications◦ quantification◦ preparing materials budget

Purchasing is a basic function in Purchasing is a basic function in materials management department of materials management department of hospital. hospital.

Right qualityRight quality

Right priceRight price

Right quantityRight quantity

Right timeRight time

Demand from the end user◦ Specifications◦ Quantity

Estimation of demand Estimation or forecasting (Estimation or forecasting (quantification)of demand can be done by of demand can be done by The past consumption methodThe past consumption method

◦ Expansion of hospital facilitiesExpansion of hospital facilities◦ Epidemics, disasterEpidemics, disaster

Morbidity patternMorbidity pattern Adjusted consumption method

Methods of PurchasingMethods of Purchasing

DecentralisedDecentralised

CentralisedCentralised

Codification Reduction in number of items and

avoiding duplication. Systematic grouping of similar items

avoids confusion Serves as starting point of simplification

and standardization Easy recognition of an item in stores

Codification Kodak System

◦ 10 digit numrical code Brisch System

◦ 7 digit code Bar code

◦ Black and white line of various thickness

Standardization A standard is defined as model or general

agreement of a rule established by authority, consensus or custom with which to measure quantities, value, dimension or quality etc.

Purchase Programme Right VendorRight Vendor NegotiationsNegotiations Competitive BiddingCompetitive Bidding DiscountDiscount Right quantityRight quantity

Tender Enquiry Limited Tender enquiry – selected firms Open tender - advertisement in news

papers Global Tender

Quality Control The materials supplied conform to the laid The materials supplied conform to the laid

down specifications or notdown specifications or not

This involves receipt of stores from suppliers as per predetermined specifications

Stores received must be stocked and preserved.

A product has little value until it is with those who utilize it.

This involves physical control of materials,

It helps in ◦ proper preservation, ◦ minimisation of obsolescence and◦ efficient handling of stores.

Cost containment measures must be undertaken to optimize the resources.

It is an organized approach to identify non-essential costs which are incurred.

This process is essential for cost reduction.

Surplus pharmaceutical products and non-functional equipment which are either obsolete or beyond economic repair will require disposal.

Non-disposal of these causes increase in the holding costs and decrease in the storage capacity.