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Emergency Capacity Building Project. Logistics. Logistics. Sub title. Logistics – Definition – The 5 ‘Rs’. Movement of Items, people and Information: To the RIGHT PLACE At the RIGHT TIME At the RIGHT COST In the RIGHT CONDITION / QUALITY / APPROPRIATENESS In the RIGHT QUANTITY.
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Emergency Capacity Building Project Logistics
Logistics Sub title
Logistics – Definition – The 5 ‘Rs’ • Movement of Items, people and Information: • To the RIGHT PLACE • At the RIGHT TIME • At the RIGHT COST • In the RIGHT CONDITION / QUALITY / APPROPRIATENESS • In the RIGHT QUANTITY
Logistics – Key elements SECURITY • Procurement • Contracts • Storage • Supply and Transportation • Distribution • Fleet management • Communications • Control systems FOR ALL ABOVE • Including Asset Management
Procurement The primary objective of all procurement is to obtain the goods and services in the optimum and most economical fashion, taking into account: 1 Quality - the desired specification & durability 2 Price - reasonable price for the quality required 3 Reliability of sources/suppliers - performances 4 Programme needs – Timing, appropriateness, continuity of supply etc.
To achieve this, procurement considers: 1. Need identification What is really needed? Specifying requirement Who is in need ?- Partners/beneficiary/programme staff etc When it is needed ? timing etc 2. Selection of supply source Where should we buy it - best supplier selection Good understanding of the supply market (+CULTURE) Getting information on potential suppliers. Assessing ability of potential suppliers – technical & financial capabilities as well as previous performance record 3. Processing the procurement –ordering & monitoring of processes Getting quotation Price analysis Contracting & follow up
In general, buying decisions have geographical and time dimensions that affect logistical cost . Therefore, the following factors have to be assessed Availability– is the item required available, where? If locally, Is there continuity of supply? (e.g. Hygiene kits) Cost effectiveness - what is the added value/advantage of buying it locally, ordering from HQ or importing it from Abroad (high profile versus what is impact on local economy?) Timing– when it is needed. Is it urgently needed? Should we go for local purchase? If we import it what is the lead time etc Distance issue – Suppliers location. if we import it how far are the suppliers as well as the entry ports etc
Procurement cont… Important Procurement Steps: • Raise -MRF – (Authorising signature, specification, Budget code) • Check stock availability – if not in stock • Call local quotes or send RFQ to HQ • Getting price information & make the bid analysis • Get budget holder approval on bid analysis and National order if HQ purchase • Placing the order (Sending purchase order to the supplier) • Following up the order • Receipt of commodities • Effecting payments • Maintaining records and files
Material Requisition • For any purchase the user department has to raise purchase requisition • No purchasing can be carried out without a formal request. • Under no circumstances should the purchasing section accept requisition from anyone other than those specifically authorized • The budget holders should check that items to be purchased are in accordance to the approved budget • Budget holders should also make sure that the project and account code to be charged are clearly indicated • All purchase requisitions must have a clear, precise and accurate description of the item requested (e.g, capacity, output, brand names, size, colour etc).
Obtaining Quotations • Collection of quotations for project items is the responsibility of the designated purchasing Officer. • There are five categories for collection of quotations: (within scuk but in all agencies it’s similar)
1) Purchase of items with a value less than Rs 5,000 • Can be done through the normal cash float system • The items can be purchased from any shops with out quotations. • But, the purchaser must compare prices before purchasing the items • 2) Purchases value between Rs 5000 and Rs 10,000 • Single proforma is required from a reliable shop • But, the purchaser must have prior price information about that particular item to avoid exaggerated quotes
3) For purchases value between Rs 10,000 and Rs 100,000 • At least three proforma invoices are required to compare price, quality and delivery time. • Quotations have to be requested and received in writing- through letters, fax or e-mail, or hand delivered • Quotations should be requested from the approved suppliers data base list where possible
4) For purchases value between Rs 100,000 and Rs 5,000,000 Properly sealed quotations are required from at least three different suppliers. These quotations have to be opened by the purchasing committee. In such a process, Sole Suppliers could exceptionally be considered for their specific brand items. There are circumstances where requirements over tender level might best be dealt with by Request for quotation method. Usually during emergencies for immediate distribution to beneficieries. However, it must be clearly justified in writing and signed off at the correct level. Suppliers must usually be given approx one week notice to submit their quotations.
5) Any purchases over the value of Rs 5,000,000 • has to be made through the formal tendering process • To be advertised through news papers (open tender) or any other appropriate media. • However, given the urgency of the need, the logistics officer can invite few reliable suppliers to submit their quotes from existing contact list (restricted tender). If approved at correct level • Such purchases will nearly always be handled by the head office Need to carefully document and justify reasons for NOT following procedure !!!
Receive MRF Is the item available in District Store Send Request to Colombo Is the item in stock? No Yes No Yes Procurement Cycle Issue the item Is the item sole-supplier product? Yes No Is this a quote or tender Level purchase? Quote. level No Tender level Restricted Tender ? Consider Potential Suppliers Yes Full tender process Consider potential suppliers Issue letters for Quotations Issue call for tender Receive Quotations Receive Tender Evaluate Quotations Evaluate tender Place order Select Supplier Prepare full Contract
Procurement continue… Cross Referencing Of Documents MRF/RFQ Bid Analysis Purchase Order/N.O. GRN
II Warehouse Management 1. Store Keeping • Commodities must be safeguarded from any type of damages until distribution to the recipient households. To this effect, store keepers must ensure that: • Storage is safe and clean, and protects food commodities from damage and loss and homogenous items are kept together. (avoid contamination) • Physical inventory counts are periodically reconciled with stock balances
2. Receiving Items Items received from the supplier or agencies, must be accompanied by a Way Bill/Delivery note or an invoice, All incoming goods must also be recorded on the Goods receiving Note (GRN) by the Store Keeper. The goods must be checked on arrival by the Store keeper and notify the senders immediately of any discrepancies (Shortage, over supply, and wrong items) . Items missing or in bad condition must also be noted on the Carrier’s copy of the Way Bill or delivery note, and should be returned to the dispatcher immediately. All incoming items must pass through the store at all times, in order to record their arrival. The Store keeper must check the quantity of the goods delivered and their condition; and make a comparison of goods received with the purchase Order or way Bills form). Whenever items are received, the Bin Cards and Stock Cards must be automatically updated, and the balances worked out.
Update computer inventory Goods Receiving procedure Update the Bin card & stock cards Check specification is in line with PO Check the items are included on the PO Check the items are in a good condition Yes Is there suppliers delivery note or WB? Check arrived items against PO or WB Prepare GRN Are there bin & stock cards for this item? Yes Ok No No Discrepancy? Notify Log Officer Notify supplier or sender Open new bin card & Stock card
3. Dispatching Goods Any Items issued with in districts offices should be done through the Stock Release Form (SRF) as well as Way Bills No item should be released from store to any person with out proper documentation. Whenever items are issued, the Bin Cards and Stock Cards must be automatically updated, and the balances worked out
Warehouse management… Dispatching procedure Yes Yes Yes Is there SRF? (Stock release form) -Check approval & Sig. Prepare way bill & issue the item Update record (Bin & Stock cards No No Reject it –ask for SRF (Stock Release) Reject it-ask for approval Update Computer Inventory
Warehouse Management Cont... 4. STOCK CARDS & BIN CARDS • All receipts and dispatches of supplies have to be recorded in the bin cards as well as Stock cards. • The incoming as well as out going Way Bill Note as well as SRF serial numbers should be recorded on the bin cards and stock control cards. • Each stock card must have a cross reference, to the location code for checking to the Bin card. • The reorder levels and balance must be clearly stated on the Bin Cards at all times.
Warehousing cont.. 5. INVENTORY • SCiSLmust organize periodic inventory of stock and all stock in the store is subject to inventory taking. • The storekeeper must report the status of the stock on a monthly basis this will be checked by the Logistics officer at district level and the National Logistics Coordinator at head office. • Stock Reconciliation form, to be used for tracking of goods. A print out of the form to be used as a report on stocks available at the end of each month. • The store keeper has to submit a weekly stock report to the logistics officer every Friday. The report contains Stock balance forward from the previous week, stock received and issued during the reporting week, stock balance at the end of the week.
The following table contains standard storage volumes for one metric tonne (1 MT) of some common relief items (volume = height x length x width)
Example calculation: (MT = Metric Tonne; m³ = cubic metre; m² = square metres) How much warehouse space is required ? A. Calculate the volume of goods: Stacking height used 50 MT Oil 2 metres (height) 100 MT Grain 2 metres (height) 200 MT Pressed blankets 3 metres (height) 40 MT Tents 3 metres (height) Total area needed for goods ? What else do you need to consider?
Example calculation: (MT = Metric Tonne; m³ = cubic metre; m² = square metres) A. Calculate the volume of goods: Stacking height used = 2 or 3 metres 50 MT Oil 50 x 2 m³ = 100 m³ / 2 metres (height) = 50.0 m² 100 MT Grain 100 x 2 m³ = 200 m³ / 2 metres (height) = 100.0 m² 200 MT Pressed blankets 200 x 4 m³ = 800 m³ / 3 metres (height) = 266.6 m² 40 MT Tents 40 x 5 m³ = 200 m³ / 3 metres (height) = 66.6 m² Total area needed for goods 483.0 m² B. Add access/aisle space: Assuming a small warehouse (i.e. with usable storage space of 75%): = Total goods areas / 75% 483 m² / 75 x 100 = 644 m² Shape of the items and compatibility to the items
Asset registration card • After initial registration is completed • All newly purchased assets MUST be registered using the Asset Registration Card • No asset can be issued from warehouse until it is first asset registered and tagged. • All original asset registration cards are sent to CMB logistics for central file and database updating
Fleet Management • The Logistics Officer should ensure that SCiSL vehicles are managed properly and efficiently. • Maximum vehicle utilization should be ensured through efficient management of a pool system and through submitting vehicle requirements and usage reports to the transport section. • The daily management of the vehicle fleet should be organized by the Logistics officer. • Generally, the Logistics Officer or transport officer/assistant is responsible for: • planning the use of the fleet • ensuring efficient and effective maintenance of the fleet • record keeping and performance analysis for each vehicle • preparing and monitoring the transport budget. • line managing the drivers.
Fleet Management cont... Vehicle information: A file is to be maintained for each vehicle in the fleet. The file must contain the following: • The vehicle procurement and location history • Completed vehicle or motorcycle log book pages • Maintenance summary • A copy of any accident forms for the vehicle • Other correspondence about the vehicle
Fleet Management cont.. Logbook: • A vehicle Logbook must be issued exclusively to each vehicle. • Drivers and other vehicle users should fill in the Logbook on daily basis clearly separating personal from official use. • There should be an entry for every day, including days idle and days in the workshop. • The Transport Officers should regularly check that logbooks are kept unto date, and collect the completed Log sheets at the first week of the next month for vehicle usage analysis work. • It is the responsibility of the driver (or senior staff member authorized to drive the vehicle) to record the following details in the logbook: • Entry at the start and finish of each trip counter signed by the officer making the trip • Record all items of fuel, oil and miscellaneous expenditure relating to the journey.
Fleet Management cont... Monthly Monitoring of the fleet It is a responsibility of the Logistics Unit to prepare a monthly performance analysis of vehicles and motorcycles from the logbook entries. This includes: • Monthly Log sheet Summary • Maintenance Summary • Monthly vehicle Performance and Cost Schedule
Fleet management cont… Planning of vehicle utilization • All requests must be submitted as early as possible to avoid problems concerning availability of vehicles and drivers. • To this effect weekly vehicle plans have to be submitted on every Thursdays for the following week travels • Note that all requests must come with the relevant sector budget code so that transport costs can be allocated to the appropriate sector • Field vehicle requests must be approved by the Sector heads or managers (e.g. Livelihood, Education, Child protection etc) for any travels out of the town • For routine travels daily vehicle Request Form must be submitted one day in advance or early in the morning (09.00 h at the latest)
Fleet Management cont.. • The daily schedule will be drawn up based on the availability of vehicles/drivers, the duration of the trip, the location of the mission, the number of people. • Any direct arrangement with the drivers is not acceptable; and should be rejected by the drivers. • All travel date changes, especially cancellations must be reported to the Logistics assistant immediately, so the vehicle/driver would be available for other trips
Vehicle availability % Availability = (Days in use + Days idle) ÷ Working Days x 100 % Availability = (20 + 3) ÷ 31 x 100 % Availability = 23 100 = 74 31 x
Vehicle Utilisation % Utilisation = Days in use ÷ (Working days – days in workshop) x 100 % Utilisation = 20 ÷ (31 – 8) x 100 % Utilisation = 20 x 100 = 87 23
