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\title{A Model for Managing and Controlling the Inventory of Stores Items based on ABC Analysis}
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             \author[1]{M.  Karthick}

             \author[2]{S.  Karthikeyan}

             \author[3]{M.C.  Pravin}

             \affil[1]{  Thiagarajar College of Enginnering}

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\date{\small \em Received: 11 December 2013 Accepted: 2 January 2014 Published: 15 January 2014}

\maketitle


\begin{abstract}
        


Today, the effective inventory management plays an important role in the success of the organizations in the new business environment. It is not clearly possible for the organizations that store hundreds of inventory items to economically design an inventory management policy for each inventory item separately. To have an efficient control of a huge amount of inventory items, traditional approach is to classify the inventory into different groups. Different inventory control policies can then applied to different groups. The well-known ABC classification is simple to understand and easy to use. Moreover, various inventory items may play quite different roles in the business of the organization. Hence, the managers need to classify these items in order to control each inventory category properly based on its importance rating. In this thesis we consider a model of college hostel mess stores items (grocery and vegetables) for inventory management through ABC analysis. This research is composed of the following sections: In the first section, the criteria affecting the evaluation of the inventory control system of the studied mess stores and the priority of each one of them will be identified, in the second section, the priority of each criterion such as cost of item, annual demand for an each item hence find annual consumption cost in each inventory category (A, B, C) is Calculated based on conventional model, in the third section, presents an alternative way of classifying the different productive items of accompanies and this ABC model compares with the classic Pareto classification, which ranks productive items according to their importance in terms of frequency and costs whereas rankings obtained using the classical method are based on information about costs and demand over a period in the past "A-items" that result from this new classification.

\end{abstract}


\keywords{ABC classification, inventory control, pareto classification.}

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\let\tabcellsep& 	 	 		 \par
important role in the success of the organizations in the new business environment. It is not clearly possible for the organizations that store hundreds of inventory items to economically design an inventory management policy for each inventory item separately. To have an efficient control of a huge amount of inventory items, traditional approach is to classify the inventory into different groups. Different inventory control policies can then applied to different groups. The wellknown ABC classification is simple to understand and easy to use. Moreover, various inventory items may play quite different roles in the business of the organization. Hence, the managers need to classify these items in order to control each inventory category properly based on its importance rating. In this thesis we consider a model of college hostel mess stores items (grocery and vegetables) for inventory management through ABC analysis. This research is composed of the following sections: In the first section, the criteria affecting the evaluation of the inventory control system of the studied mess stores and the priority of each one of them will be identified, in the second section, the priority of each criterion such as cost of item, annual demand for an each item hence find annual consumption cost in each inventory category (A, B, C) is Calculated based on conventional model, in the third section, presents an alternative way of classifying the different productive items of accompanies and this ABC model compares with the classic Pareto classification, which ranks productive items according to their importance in terms of frequency and costs whereas rankings obtained using the classical method are based on information about costs and demand over a period in the past "A-items" that result from this new classification. 
\section[{Introduction}]{Introduction}\par
iven that at present, all the organizations maintain thousands different types of inventory, it is likely to lose the effective inventory management. Therefore, it is particularly important for all the organizations to establish the appropriate inventory control systems or to evaluate and improve the existing inventory control systems. Because on the one hand, the organization encounters the inventory-related costs, including Cost of Holding, Cost of Ordering, Cost of Shortage the increase of each one due to the lack of a suitable inventory control system will have negative effects on the profitability of the organization. On the other hand, since the number of inventory items is largely increasing due to the increase of the customers' demands for different products, the organizations should have a quick and effective response to the customers' demands to survive and maintain their competitive advantage. The establishment or improvement of an appropriate inventory control system can lead the organization in this path. Considering that today, the organizations save a large percentage of their total investment in the inventories, it has become of a special importance to all organizations to properly manage the inventory and establish a proper inventory control system. According to what was mentioned, all the organizations need an appropriate inventory control and planning system in order to effectively manage their resources and inventories. Therefore, in order to create a perfect inventory control system, various inventory items should be classified into the significant categories based on appropriate criteria and standards. Various models and methods have been so far presented to classify inventory among which, ABC analysis approach is one of the most common methods which is widely used for planning and inventory control  {\ref (Kilgour \& et al 2006)}. Inventory classification based on ABC analysis allows the organization to classify its inventory into the significant categories. Generally, the above approach has been formed based on the Pareto Principle which is also known as "20-80" law. Regarding the organizations' inventory, this principle will be expressed as follows: In the manufacturing organizations, there are only a few inventories which mostly contribute to the cost of the annual consumption of the organization's inventory system and there are only anew inventories which a little contribute to the dollar value of the annual consumption of the inventory system. Given that the primary purpose of the inventory classification based on this approach is to create appropriate control levels for each inventory category, this question will be raised that whether the inventory classification based on single criterion ABC analysis will be able to meet all the needs of the organization's inventory control system. As a result, the organizations can apply proper control policies by identifying the most effective criteria in their inventory classification. This study has also tried to present proposed ABC model for the hostel mess stores, in order to evaluate the inventory control system of the studied in that. For this purpose, first, the criteria affecting the evaluation of the inventory control system, classification of inventory and the priority of each One of the criteria in the studied mess stores and the priority of each one of the criteria in each inventory category (A, B, C) have been identified and model will be proposed. 
\section[{II.}]{II.}\par
Literature Review  
\section[{III.}]{III.} 
\section[{Problem Environment}]{Problem Environment}\par
A study is conducting in TCE men's hostel for my thesis. In TCE mans hostel there are two stores are available. One is for variety mess store and another one is for value mess store. Totally 550 students are in value mess and 650 students in variety mess. Here I identified the problem in inventory in both stores. Due to incorrect optimal order quantity and insufficient forecasting the more inventories held in both mess. In the mess stores they used previous experience for order the items. They did not use any formulation or techniques such as P MODEL, Q MODEL system for find the optimal order quantity. So that only inventory problem arises there. So here in my thesis I will use both the system and find EOQ for all items thereby reduce the inventory level and reducing annual consumption cost of mess stores. In order to find the EOQ, it is very important to know about that are the various items affecting the inventory cost in stores. So ABC analysis is requiring knowing about the inventory affecting items. Form the ABC analysis we have easily know the items which are contribute in inventory, only the A types item. So, in this paper presents only the ABC classification of stores items (grocery \& vegetables) of hostel mess stores.\par
IV. In this proposed methodology the various data's such as unit price of an item, annual demand of an item were collected from mess stores and based on this data, grocery and vegetables were segregated for doing the ABC analysis of an each and individual items. 
\section[{Proposed Model}]{Proposed Model}\par
V.  From this ABC analysis of vegetables items A type items have more annual consumption costs. So here 4 items have classified under A category out of 28 items.  
\section[{Results and Discussions}]{Results and Discussions} 
\section[{Conclusion}]{Conclusion}\par
In this study, the indices affecting the evaluation and control of the inventory control system of TCE men's hostel stores. the results of ABC classification that these criterions of "the required accuracy in ordering" in the inventory category A and the criterion of "the effect of inventory on the process" in the inventory categories B and C have the highest importance. From this ABC analysis of grocery items A type items have more annual consumption costs so here 13 items have classified under A category out of 57 item and of groceries. For vegetables here 4 items have classified  
\section[{PIE CHART FOR VEGETABLES}]{PIE CHART FOR VEGETABLES}\par
items have more annual consumption costs and creates more inventory in stores. So Economic Order Quantity and re-order level will be calculated for these A type items hence reduce inventory and annual consumption cost.\begin{figure}[htbp]
\noindent\textbf{4}\includegraphics[]{image-2.png}
\caption{\label{fig_1}Figure 4 :}\end{figure}
   \begin{figure}[htbp]
\noindent\textbf{5} \par 
\begin{longtable}{P{0.0547423887587822\textwidth}P{0.19607728337236535\textwidth}P{0.08758782201405152\textwidth}P{0.12441451990632318\textwidth}P{0.15526932084309134\textwidth}P{0.21001170960187354\textwidth}P{0.02189695550351288\textwidth}}
\tabcellsep \tabcellsep \tabcellsep \multicolumn{3}{l}{1 : ABC analysis for grocery}\tabcellsep \\
\tabcellsep \tabcellsep \tabcellsep \tabcellsep Annual\tabcellsep Cumulative\tabcellsep \\
\tabcellsep \tabcellsep Price/unit\tabcellsep Unit/year\tabcellsep consumption\tabcellsep values of Annual\tabcellsep \\
\multicolumn{2}{l}{Sl.No Description}\tabcellsep (Rs.)\tabcellsep (kg)\tabcellsep Rs./year\tabcellsep \multicolumn{2}{l}{Consumption(Rs.) Classification}\\
24\tabcellsep Peanut oil\tabcellsep 85.9\tabcellsep 15600\tabcellsep 134004\tabcellsep 1340040\tabcellsep A\\
1\tabcellsep Rice(Ponni)\tabcellsep 34.6\tabcellsep 21600\tabcellsep 747360\tabcellsep 2087400\tabcellsep A\\
2\tabcellsep Idly rice\tabcellsep 28\tabcellsep 14400\tabcellsep 403200\tabcellsep 2490600\tabcellsep A\\
35\tabcellsep Ghee\tabcellsep 370\tabcellsep 1080\tabcellsep 399600\tabcellsep 2890200\tabcellsep A\\
8\tabcellsep Black gram\tabcellsep 62.9\tabcellsep 4800\tabcellsep 301920\tabcellsep 3192120\tabcellsep A\\
28\tabcellsep Wheat flour\tabcellsep 34.7\tabcellsep 7200\tabcellsep 249840\tabcellsep 3441960\tabcellsep A\\
26\tabcellsep Papadam\tabcellsep 100\tabcellsep 2400\tabcellsep 240000\tabcellsep 3681960\tabcellsep A\\
54\tabcellsep Garlic\tabcellsep 119\tabcellsep 1800\tabcellsep 214200\tabcellsep 3896160\tabcellsep A\\
5\tabcellsep Red gram\tabcellsep 64.6\tabcellsep 3240\tabcellsep 209304\tabcellsep 4105464\tabcellsep A\\
6\tabcellsep Green gram\tabcellsep 71.9\tabcellsep 2880\tabcellsep 207072\tabcellsep 4312536\tabcellsep A\\
4\tabcellsep Basmati rice\tabcellsep 84.75\tabcellsep 2440\tabcellsep 206790\tabcellsep 4519326\tabcellsep A\\
21\tabcellsep Fried gram\tabcellsep 53.5\tabcellsep 3600\tabcellsep 192600\tabcellsep 4711926\tabcellsep A\\
25\tabcellsep Sesame oil\tabcellsep 258\tabcellsep 720\tabcellsep 185760\tabcellsep 4897686\tabcellsep A\\
41\tabcellsep Boost\tabcellsep 334\tabcellsep 540\tabcellsep 180360\tabcellsep 5078046\tabcellsep B\\
42\tabcellsep Bounvita\tabcellsep 330\tabcellsep 540\tabcellsep 178200\tabcellsep 5256246\tabcellsep B\\
37\tabcellsep Prunes\tabcellsep 408\tabcellsep 360\tabcellsep 146880\tabcellsep 5403126\tabcellsep B\\
48\tabcellsep Vermicelli\tabcellsep 54\tabcellsep 2440\tabcellsep 131760\tabcellsep 5534886\tabcellsep B\\
20\tabcellsep Asafoetida\tabcellsep 600\tabcellsep 180\tabcellsep 108000\tabcellsep 5642886\tabcellsep B\\
36\tabcellsep Cardamoms\tabcellsep 599\tabcellsep 180\tabcellsep 107820\tabcellsep 5750706\tabcellsep B\\
27\tabcellsep Maida flour\tabcellsep 35.5\tabcellsep 3000\tabcellsep 106500\tabcellsep 5857206\tabcellsep B\\
39\tabcellsep Tea powder\tabcellsep 290\tabcellsep 360\tabcellsep 104400\tabcellsep 5961606\tabcellsep B\\
51\tabcellsep Ground nut\tabcellsep 82\tabcellsep 1200\tabcellsep 98400\tabcellsep 6060006\tabcellsep B\end{longtable} \par
 
\caption{\label{tab_1}Table 5 .}\end{figure}
 \begin{figure}[htbp]
\noindent\textbf{5} \par 
\begin{longtable}{P{0.07714968152866242\textwidth}P{0.16918789808917198\textwidth}P{0.06632165605095541\textwidth}P{0.1448248407643312\textwidth}P{0.15294585987261144\textwidth}P{0.2165605095541401\textwidth}P{0.02300955414012739\textwidth}}
\tabcellsep \tabcellsep \tabcellsep \multicolumn{3}{l}{2 : ABC analysis of vegetables}\tabcellsep \\
\tabcellsep \tabcellsep \tabcellsep \tabcellsep Annual\tabcellsep Cumulative Value\tabcellsep \\
\tabcellsep \tabcellsep Price/unit\tabcellsep \tabcellsep consumption\tabcellsep of Annual\tabcellsep \\
\multicolumn{2}{l}{Sl.No Description}\tabcellsep (Rs.)\tabcellsep Unit(kg)/year\tabcellsep Rs./year\tabcellsep \multicolumn{2}{l}{Consumption(Rs.) Type}\\
1\tabcellsep Onion\tabcellsep 19\tabcellsep 30000\tabcellsep 570000\tabcellsep 570000\tabcellsep A\\
3\tabcellsep Tomato\tabcellsep 13\tabcellsep 10800\tabcellsep 140400\tabcellsep 710400\tabcellsep A\\
4\tabcellsep Potato\tabcellsep 23\tabcellsep 6000\tabcellsep 138000\tabcellsep 848400\tabcellsep A\\
\multicolumn{2}{l}{20 Cauli flower}\tabcellsep 24\tabcellsep 2600\tabcellsep 62400\tabcellsep 910800\tabcellsep A\\
25\tabcellsep Amaranth\tabcellsep 19\tabcellsep 3000\tabcellsep 57000\tabcellsep 967800\tabcellsep B\\
2\tabcellsep Shallot\tabcellsep 38\tabcellsep 1200\tabcellsep 45600\tabcellsep 1013400\tabcellsep B\\
28\tabcellsep Drumstick\tabcellsep 60\tabcellsep 720\tabcellsep 43200\tabcellsep 1056600\tabcellsep B\\
\tabcellsep Ladies\tabcellsep \tabcellsep \tabcellsep \tabcellsep \tabcellsep \\
8\tabcellsep finger\tabcellsep 15\tabcellsep 2400\tabcellsep 36000\tabcellsep 1092600\tabcellsep B\\
19\tabcellsep Beans\tabcellsep 19\tabcellsep 1800\tabcellsep 34200\tabcellsep 1126800\tabcellsep B\\
7\tabcellsep Brinjal\tabcellsep 13\tabcellsep 2440\tabcellsep 31720\tabcellsep 1158520\tabcellsep B\\
10\tabcellsep Cabbage\tabcellsep 10\tabcellsep 2400\tabcellsep 24000\tabcellsep 1182520\tabcellsep B\\
9\tabcellsep Green chilli\tabcellsep 20\tabcellsep 1080\tabcellsep 21600\tabcellsep 1204120\tabcellsep B\\
17\tabcellsep Ginger\tabcellsep 54\tabcellsep 360\tabcellsep 19440\tabcellsep 1223560\tabcellsep B\\
27\tabcellsep Panner\tabcellsep 25\tabcellsep 720\tabcellsep 18000\tabcellsep 1241560\tabcellsep C\\
12\tabcellsep carrot\tabcellsep 16\tabcellsep 960\tabcellsep 15360\tabcellsep 1256920\tabcellsep C\\
\tabcellsep Coriander\tabcellsep \tabcellsep \tabcellsep \tabcellsep \tabcellsep \\
15\tabcellsep leaves\tabcellsep 20\tabcellsep 720\tabcellsep 14400\tabcellsep 1271320\tabcellsep C\\
26\tabcellsep Mushroom\tabcellsep 20\tabcellsep 720\tabcellsep 14400\tabcellsep 1285720\tabcellsep C\end{longtable} \par
 
\caption{\label{tab_2}Table 5 .}\end{figure}
 			\footnote{© 2014 Global Journals Inc. (US)} 		 		\backmatter  			  				\begin{bibitemlist}{1}
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\end{document}
