Purchasing Methods
Every battery service station proprietor is eager to build up his business, and improve the character of his trade, because this in turn means that he will be assured of larger sales to a good class of customers. And it is at once evident that there are a number of requirements that affect this question of building up a business, one of the first in importance being that of purchasing.
One of the first things with which the battery man is faced is the question of what, where, and in what quantities to purchase. The philosophy of correct purchasing consists in getting the right materials, in proper quantities, at a low price, and with as little cost for the doing of it as possible. The purchasing problem should be a most interesting and important subject to the proprietor of every service station, because the policy pursued with regard to purchasing will not only largely govern the economy of all his expenditures, except rent and payroll, but it will also control his selling policies. Goods are sold, and services rendered only because some one wants to buy. The customer’s purchasing problems govern the proprietor’s selling problems. To sell properly, it is necessary to meet the requirements of those who buy.
Correct purchasing is not merely a matter of “buying.” The buying itself has but little to do, after all, with the question of real economy in this part of the business. The proprietor’s purchasing policy should not cease when the purchase order is made out, but should continue after the goods have been delivered, received and inspected. He should see that they are properly stored, that they are put to the use intended, and that they are used efficiently. This can be accomplished to good advantage by the use of the Stock Record illustrated in Fig. 186.
When goods are received, each item should be entered on these Stock Record cards, keeping in mind always that the requirements of a “perpetual” or “going” inventory of this kind are that a separate account be kept with each kind or class of stock, and not alone with each class, but with each grade of each class.
For example, if a quantity of batteries were received, it would not suffice to have one card only for the entire quantity, unless they should happen to be all of the same type and make. It should be understood that these cards are a record of all articles coming into stock, and all articles going out of stock in the way of sales or otherwise, with an individual card for each kind, grade, style or size of stock carried on hand.
From the purchase invoices covering stock received, an entry is made in the column headed “Received”, to the proper account, showing date, order number, quantity and price.
Each sales tag is used to make the entries in the columns headed “Disbursed”, in which the date, tag number, quantity, price, and the balance quantity on hand are shown.
If this is done daily, for all the sales tags of the particular day, and the cards on which the “disbursed” entries were made are kept separate from the balance of the cards, it is an easy matter to arrive at the cost of all sales for each day, The advantage of having this daily information will be explained and illustrated in following paragraphs.