Explain the advantages of centralized system of maintaining stores.

Management Accounting Block Revision Mock Exams

Advantages of centralized systems of maintaining stores:

Lower stocks on average which lowers the holding costs. Less risk of duplication of costs and efforts.
Closer control of stocks and costs is possible at the central site.
Higher quality staff may be efficiently employed to specialize in various aspects of store keeping.
Reduced paperwork
Bulk purchasing reduces the purchase cost due to quantity discounts Stock taking is facilitated
It is cost effective to employ expensive and advanced technology. Standardization of procedures is possible and easily enforced

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