Post Exchange Methods / A Manual for Exchange Stewards, Exchange Officers, Members of Exchange Councils, Commanding Officers, Being an Exposition of a Simple and Efficient System of Accounting Which Is Applicable to Large and to Small Exchanges Alike.

by Paul D. Bunker

In General.

One of the most important points connected with the running of any store, is that referring to the manner in which the records of the stock are kept. In most Exchanges, the stock records are not good; usually, because a clumsy or inefficient system of records is in force. An endeavor will be made in the description to be given hereafter to set forth a system whereby misuse of stock will be prevented and an accurate estimate of the profits made by each department will be possible. The objection may be made to this system that in a large exchange it would require the services of one clerk to keep the stock records alone, but when we realize that an inefficient stock record can and usually does result in losses that are sometimes much greater in value than this clerk’s wages, we see the futility of such an argument. It is useless to try to avoid the conclusion that we must keep accurate track of our merchandise. In an exchange at, say, a 5-company post, it is economy to pay one man $100.00 per month or even more, to take exclusive charge of the stock records.

In the first place, it is essential to make clear in the minds of the Exchange authorities the difference between a stock room and a store room. The former is for storing merchandise that is bought in large quantities and will not be needed in the various departments for some time. The merchandise in the stock room is charged to it on the Stock Records until it is needed in one of the departments when it is sent to and its value charged against that department and credited to the stock room. A store room in the sense now considered is a place in which we may store the merchandise belonging to and already charged against any department. This “place” may be but a corner or a shelf in the stock room or any other room. As a general rule, it is best to charge merchandise direct to the proper department, as it saves time and work. Then, if the department concerned finds that it is inconvenient to keep this merchandise on its counters or shelves, it can transfer some of it to the proper store room until needed. Both the stock room and the store rooms should be under the jurisdiction of the stock clerk, the former exclusively so. Efficient locks should be provided for these rooms and he or his agent should be the only persons authorized to handle the stock therein.

The stock record is simply a stock ledger in which we keep accurate account of the numbers of articles acquired and dispensed. If practicable, it should show at all times the exact number of each article that we have on hand. Such a record is sometimes called a “Perpetual Inventory”. It would not be practicable in the usual case for us to keep such a record in post exchange business for the reason that it would be extravagant for us to record each cash or coupon sale made during the day. For example, during certain days of the month, such as pay day and the first day upon which coupons are issued, it is manifestly impracticable for us to make out a sales slip for each cash or coupon purchase because there are so many five and ten cent purchases that the cost in time and labor involved in such a method would outweigh the advantages gained. If the average sale amounted to a dollar or so, it might pay us to use sales slips similar to those used in recording our charge sales. Therefore, most Exchanges do not require cash or coupon sales to be recorded except on the cash register. Hence, there is no itemized record of the merchandise that is sold during the day for cash or for coupons, which in turn makes it impossible to keep a perpetual inventory. The result is that an inventory must be taken at least once a month.

If we now take such an inventory and calculate the selling price of all the goods found, the result will represent the receipts each department should turn in if they sold out all of their stock. If we keep adding to this amount the selling price of all merchandise that we receive for and issue to the departments for sale, and deduct the selling price of all articles which each department turns in to the stock room, we shall have, at the end of the month, figures which represent the receipts which should be turned in if each department were to “sell out”. By subtracting from these amounts the actual receipts turned in during the month, we find the selling price of the articles which should be on hand at the end of the month. By taking an inventory at the end of the month and figuring out the selling value of the articles actually found, we can check the operations of our various departments. If there is any great discrepancy, it would show that our clerks are, in effect, taking articles from our shelves and the Exchange is not getting the benefit of its sales. It is not to be expected that these amounts will agree to the cent.

Now if there is but one clerk in any department, it is easy to fasten the responsibility for any shortage, but where there are several, special steps must be taken in order to do this. Suppose we have four clerks in the store department; if they sell from the various shelves indiscriminately, or if one or more of them are sometimes away on duty, it would be manifestly unjust to hold any particular clerk or even all of them responsible for any shortages which might occur. The only solution lies in sub-dividing the store into sections, putting one clerk in sole charge of each and allow no clerk to touch the stock in another man’s section. In case a clerk in unavoidably absent, an inventory of his section can be made in a few minutes, and, if the results at the end of the month show it to be desirable, checked against the sales he had made. In this way, both the clerk and the Exchange are protected. A “roving” clerk or the Steward can take the place of the absentee in case of necessity. Heavy sellers like tobacco and the like can be placed in the sections of two or more clerks, thus taking care of pay day rushes. Unless some such scheme is adopted it will be absolutely impossible to fix the responsibility for any loss the Exchange may incur.

Those departments which are, in effect, “manufacturing” departments, such as the lunch room, meat market, etc., also require special treatment, especially in the matter of figuring the selling price of merchandise issued to them.

It goes without saying that the honesty of the stock clerk must be above suspicion. In case a civilian is employed, it is good policy—in fact, it should be considered imperative that he be required to execute a bond for the faithful performance of his duties.

With the above general explanation of the broad principles of this particular system, we are now prepared to discuss it more in detail. It seems generally conceded that the stock records can be kept most easily, cheaply and efficiently by means of the card index system. The present regulations, previously cited, specify an “inventory book”, and inspectors are prone to interpret the regulations literally. It makes little difference in our case which method is used, except that the card system is more efficient, as before stated. The handling of the inventory book requires no explanation, so, in order to provide for the time (which should be in the near future) when the up-to-date card system of inventory is specifically allowed in regulations, the following description is given. It is hoped that it will prove a conclusive answer to those who ask, “But suppose you lose a card.”