Coding is a system of words, letters or combination of both that entails brief information pertaining various materials. Coding is a logical way of describing materials and it is used specifically to identify items exactness.
Advantages of a coding system:
(1) To avoid repetitive use of long description of items.
(2) To ensure accuracy in the description and identification of all items.
(3) Prevent duplication of items.
(4) Provide a foundation for an efficient purchasing organization.
(5) Convenient basis is formed for sorting and recording items.
(6) Simplify manual recording.
(7) Facilitate convenient central analysis of unit store house records.
(8) Simplify stock control accounting.
(9) Simplify pricing and costing of materials.
(10)May be used as storehouse location system.
Disadvantages of stock coding:
(1)The process of preparing stock codes is tedious.
(2) It requires a lot of memorizing.
(3) It complicates the storage function further.
(4) It may lead to a proliferation of jargon making it difficult for outsiders to understand.
Characteristics of codes:
- Uniqueness: Each item should have one code
- Distinctiveness: To avoid errors, codes representing different items should be distinctive.
- Clarity: Code should be entirely Alphabetical or Numerical
- Brevity: Codes should be brief but consistent with the requirement
- Expandable: codes should be able to cope with new additional items
- Unambiguous: Codes with similar letters should be avoided
- Significant: The code should signify something about the coded item
