Module 3 lessons 4 to 6 par stock,inventory control and stock-taking

Lesson 4 Par Stock
Lesson 5 Inventory Control
Lesson 6 Stock-taking

1. Module 3 Managing inventories HM 405: Elec. Housekeeping Operations Prepared by: Prof. Rowena R. De Leon

2. Lesson 4 Prepared by: Prof. Rowena R. De Leon Par stocks HM 405: Elec. Housekeeping Operations

3. Prof. Rowena R. De Leon HM 405: Elec. Housekeeping Operations 4 .1 INTRODUCTION In the Hotel Industry, par stock is the widely used term which is the standard way to determine the minimum level of supplies to meet daily demands of daily hotel operation, Proper application of par stock can ensure smooth functional activity. What is the first and most important task in effectively managing inventories? Determining the par level for each inventory item. Par refers to the standard number of inventoried items that must be on hand to support daily, routine housekeeping operations. Par levels are determined differently for recycled and non-recycled inventories. They are directly related to the usage rates of different items used in the all departments. Inventory levels for recycled items are measured in terms of par number or a multiple of what is required to support day-to-day functions. Inventory levels for non-recycled items are measured in terms of a range between minimum and maximum requirements. What should happen when quantities of a non-recycled inventory item reach the minimum levels?

4. Prof. Rowena R. De Leon HM 405: Elec. Housekeeping Operations Cont’d… Importance of Par Stocks To make correct and efficient investment of capital. To prevent over stocking. To make optimum use of space. To ensure proper supply at all times. To help effective budgeting. To simplify inventory taking. To bring about control.

5. Prof. Rowena R. De Leon HM 405: Elec. Housekeeping Operations 4 .2 How to Establish Par Stock This sections below give a simple way to establish par stock figures. Linen Determine the requirement of each guest room. This is multiplied five times as per the following cycle: One set of linens in the room (bed linen) One set in the laundry (in washing process) One set in transit One set in main linen room One set linen in pantry room / maid trolley

6. Prof. Rowena R. De Leon HM 405: Elec. Housekeeping Operations PAR STOCK LEVEL

7. Prof. Rowena R. De Leon HM 405: Elec. Housekeeping Operations Cont … Uniforms The par stock of uniforms is determined on the basis of cloth material and job positions and the nature of jobs. For changes are kept for uniforms changed daily such as waiter coats, utility worker uniforms, etc. More specialized uniforms may have turnover of two to three times only, in view of cost. The cycle of par stock is as follows: One Change in the laundry One change in the uniform room One change in the housekeeping room One change in use

8. Prof. Rowena R. De Leon HM 405: Elec. Housekeeping Operations 4 .3 PAR STOCK/LEVELS Problems related to par stock: Overstocking or too many circulation may result in spoilage during storage (space problem) leads to abuse of linen (theft, misuse) and low productivity in the laundry. Under stocking or too few circulation may result in guest complaints, extended laundry operation hours, increase laundry cost (payroll), decreased productivity by staff waiting for linen and a shortening of useful life for linen because it cannot rest.

9. Prof. Rowena R. De Leon HM 405: Elec. Housekeeping Operations Cont … What must executive housekeepers do to avoid shortages? What are House Setups? Is the hotel’s laundry cycle an important factor in determining linen pars? T he laundry cycle in properties with on-property laundries should maintain three par of linens: one par- laundered , stored and ready to for use today; a second par – yesterday’s linens which are laundered today: an a third par- linens to be stripped from rooms today and laundered tomorrow. Extras requirements must also be taken into consideration. The second factor to consider when establishing linen par levels is the replacement of worn, damaged, lost, or stolen linen. A general rule of thumb is to store one full par of new linens as replacement stock on an annual basis. The third factor is to be always prepared for emergency situations. This suggest that with the above factors to be considered a minimum of five par of linen should be maintained on an annual basis.

10. Lesson 5 Prepared by: Prof. Rowena R. De Leon Inventory Control HM 405: Elec. Housekeeping Operations

11. Prof. Rowena R. De Leon HM 405: Elec. Housekeeping Operations 5 .1 CONTROL OF LINEN Control of linen falls in three areas of activity:   Hygienic standard and appearance of linen . Daily routine exchange of linen between floors and departments, linen room and laundry . Purchase records, inventories, stock-taking and stock- taking records.   Handling linen from purchase to use to laundering and storage before it is used again is a difficult task requiring much expertise as well as close supervision. Each system has its own merits and linen control must be balanced against saving time and wages/ money.   Primarily , purchase records must be correctly maintained as they form the basis of stock taking. Daily records keep a track of linen on a day-to-day basis. It is also necessary to maintain a record of condemned linen and any remakes from these discarded items to provide a clear picture during stocktaking.

12. Prof. Rowena R. De Leon HM 405: Elec. Housekeeping Operations 5 .2 INVENTORY CONTROL OF LINEN S ince uniform and linen are heavy investments, it is necessary to keep a close control on this very important asset. Effective control is possible through the following practices: Control on misuse, shortages and mix-ups Proper storage Regular stock-taking Spot checks Proper supervision

13. Prof. Rowena R. De Leon HM 405: Elec. Housekeeping Operations Cont’d… Policies and Procedures relating to linen inventory control must address: How and where linens will be stored? When and to whom linens will be issued? How to monitor and control the movement of linens through the laundry cycle? Effective communication between the executive housekeeper and the laundry manager will ensure that an accurate daily count of all linen is received from and sent to the laundry. Also this will help with spotting shortages or excessive amounts of linen being circulated. Storage : laundered linen should rest in storage for at least 24 hours. This helps increase the useful life of linens an provides an opportunity for wrinkles smooth out in permanent press fabrics. Linen Storage should also be: Relatively humidity free Adequately ventilated Shelved with smooth free access Kept locked at all times

14. Prof. Rowena R. De Leon HM 405: Elec. Housekeeping Operations 5 .3 ISSUING OF LINEN What is a Floor Par? The quantity of each type of linen that is required to outfit all rooms serviced from a particular floor linen closet. A linen par should be established and posted in each floor linen closet. The distribution of this linen is based on the information received from the Occupancy report generated by the front desk. The laundry manager will set aside the required amount of clean linens and stores excess clean linens in the laundry distribution room. These distribution rooms are usually stocked to full par each day, in the evening, so that the morning shift is fully prepared to carry out their required task without delay. Replacement linen is required for torn, stained and excessive worn linen. Damaged or soiled linen should be placed in special discard containers and hand-delivered to the main housekeeping office. The laundry manager will increase the floor distribution count the next day to accommodate the need for replacement linen.

15. Prof. Rowena R. De Leon HM 405: Elec. Housekeeping Operations 5 .4 INVENTORY CONTROL OF MACHINE AND EQUIPMENT The executive housekeeper is responsible for seeing that members of the housekeeping department have the proper tools to carry out their assigned task. Inventory Control of Machines and Equipment involves maintaining accurate inventory records, establishing issuing procedures an ensuring that storage areas are secure.

16. Prof. Rowena R. De Leon HM 405: Elec. Housekeeping Operations 5.5 INVENTORY CONTROL OF CLEANING SUPPLIES Controlling the inventory of cleaning supplies involves establishing strict issuing procedures to regulate the flow of products from the main storeroom to the floor cleaning closets. It also involves maintaining accurate counts of the products on hand in the main storeroom. By recording both purchases and issues of cleaning supplies the executive housekeeper can monitor the actual usage of each product kept in inventory . The Minimum Quantity: refers to the fewest number of purchase units that should be in stock at any given time. The Lead Time Quantity: refers to the number of purchased units that are used up between the time that a supply order is placed and the time it is actually received. The Safety Stock Level: refers to the number of purchase units that must always be on hand for the housekeeping department to operate smoothly in the event of emergencies, spoilage, unexpected delays in delivery etc. etc.. By adding B and C the executive housekeeper can determine the minimum number of purchase units that always needs to be stocked . The Maximum Quantity : refers to the greatest number of purchase units that should be in stock at any given time. What factors should be considered when determining maximum inventory quantities? Also why must they not be set too high?

17. Prof. Rowena R. De Leon HM 405: Elec. Housekeeping Operations 5.7 INVENTORY CONTROL OF GUEST SUPPLIES Guest supplies : Bath and facial soap, toilet and facial tissue and hangers, sewing kits, pens, laundry bags , shower caps, shampoos , conditioners etc Establishing Inventory Levels for Guest Room Supplies : would be the quantity of each guest supply needed to outfit all occupied rooms in the hotel one time. {see ex 11 on pg 138} Inventory Control of Guest Supplies: are done similar to that of cleaning supplies. Par levels are established, physical inventories are taken, and records maintained. Printed Material and Stationary: Letter heads , postcards, writing paper maps, brochures, service menus, etc etc… Par stock levels for stationary items are established in the usual manner for non-recycled inventory items. Occupancy levels, usage rates, safety levels, lead-time quantities, and purchasing schedules are considered when determining minimum and maximum inventory levels

18. Lesson 6 Prepared by: Prof. Rowena R. De Leon Stock-taking HM 405: Elec. Housekeeping Operations

19. Prof. Rowena R. De Leon HM 405: Elec. Housekeeping Operations 6 .1 Stock Taking Stock taking is counting what you have (actual or physical stock) and comparing it with what you are supposed to have (book or recorded stock). It is an essential activity that must be carried out at regular intervals. Any discrepancies should be accounted for and adjusted in the records. It is an operational necessity in order to be able to predict future requirements. Stocktaking acts as a control measure by highlighting discrepancies, thereby prompting investigation. It also acts as a deterrent against pilferage. It also ensures rotation of stocks as well as helps to generate purchase orders as replacements to cover shortages.

20. Prof. Rowena R. De Leon HM 405: Elec. Housekeeping Operations 6.2Procedure for Linen Stock Taking:   Departments concerned must be intimated at least one day in advance. All linen must be counted on the same day or at least the similar type linen is counted at a time (Room Linen is separated from F & B Linen), so as to prevent ‘borrowing’ to make up deficiencies. A convenient time is chosen when all linen movement can be halted without causing too much of a problem to the operations. Figure 2 Linen Stock Register

21. Prof. Rowena R. De Leon HM 405: Elec. Housekeeping Operations Procedure of Stock-taking Identify all locations of linen. These locations will be: Beds in the guest rooms, Floor linen pantries End of chutes receiving soiled linen from floors at the laundry stop. Linen in the laundry-in wash, in hampers, at the presses, in storage shelves and in trolleys laden with laundered linen ready for delivery to the linen room. Linen room Linen stores Linen stock-taking is done at the end of the morning shift when guest rooms have been made for the day. All floor linen rooms are sealed. All chutes are sealed Laundry delivery carts are frozen for dispatch. Linen store is sealed. Linen room are sealed

22. Prof. Rowena R. De Leon HM 405: Elec. Housekeeping Operations Cont.. 8. The stock-taking team consisting of the auditor from accounts, ledger accountant, linen supervisor and the housekeeper will start physical inventory count at each location. They will complete an Inventory Count Sheet-Room on each floor. 9. The housekeeper will transcribe the information of all the floors onto a Master Inventory Sheet. 10. A similar counting exercise is done for the Restaurants. Restaurant stock-taking is performed after 3 P.M. when restaurant close after lunch. A 24-hour restaurant like the coffee shop may take its inventory after 12 midnight when the traffic is slow. The locations of restaurant linen are: Table tops Side-station shelves for fresh linen Soiled linen hampers On trays The housekeeper will have a separate Inventory Count Sheet-Restaurants 11. She will transcribe the information onto the Master Inventory Count Sheet- F&B. In reality, there will be several dimensions of table clothes and tray clothes. The format will fit the exact requirements of the establishments.

23. Prof. Rowena R. De Leon HM 405: Elec. Housekeeping Operations Cont’d... 12. The auditor transcribe all the information onto the Inventory Control Chart-Rooms. The auditor transcribe all the restaurant linen information into the Inventory Control Chart-F&B. The statements are further consolidated by the auditor and financial controller into a Master Inventory Sheet. The Master Inventory Sheet will be shown to the General Manager for his comments and signed off before it is shown to the owner.

24. Prof. Rowena R. De Leon HM 405: Elec. Housekeeping Operations 6 .3 LINEN HIRE Hiring linen is uncommon, but many hotels in other parts of the world do not purchase linen, and prefer to hire laundered linen from a hiring company. Linen hire companies supply clean linen to hotels on a rental basis on contract. The system has both advantages and disadvantages. Advantages:   Initial purchase investment is eliminated. No laundering of linen is necessary. Less storage space. Less staff which means fewer salary cheques to pay. No need to order linen, so linen purchase function is eliminated. No repairing of linen by the hotel/ small tailoring department. It is ideal for spasmodic trade such as seasonal hotels, by avoiding capital expenditure and the need to store seldom/ sparingly used linen. Linen hire charges may be no greater than the combined depreciation and laundering costs .

25. Prof. Rowena R. De Leon HM 405: Elec. Housekeeping Operations Cont’d…. Disadvantages:   No individuality. Choice is limited – the linen specifications, sizes and standards may be different from those required by the hotel. No cut-downs or makeovers possible. Damages have to be paid for, usually at a higher rate. The hotel is totally dependent on the hiring company. There is no control over the quality of wash. Linen supply may be affected by bad weather or strikes causing a breakdown in operations. If low occupancy, there is a loss due to unused linen. Excess / emergency requirement is charged at the current rate. Guest laundry will have to be dealt with or co-ordinated with a commercial laundry.

26. The end Prof. Rowena R. De Leon HM 405: Elec. Housekeeping Operations