JOURNAL OF THE SOCIETY OF COSMETIC CHEMISTS incorrect weights or quantities, there is a possibility of mistakes by the suppliers, or of leakages or losses during transport from the supplier's to the buyer's premises. MANUFACTURING USES This entails rather more work--but if the extensions are done once every four weeks a considerable amount of time can be saved. A four-weekly period is better than a calendar month, as normally things are clearer in the depart- ment at a week-end than during the week. The department will make daily records of batches made and the size of the batches, and batches issued to other departments. At the end of each period the total number of batches of each product can be extended to give the total usage of ingredients. FILLING USAGES The department will make daily entries of batches used after satisfying themselves that the batch is correct size, and will record number of packages produced (giving necessary details of size, type of container and type of packing). It is an advantage if each type of pack of each product is given a number as this number will give all details. Particulars of dispatches to warehouse or sale are also entered. WAREHOUSE Should agree particulars of all material received from ftl]ing and packing department. From the above records it will be quite easy to check up on the productive efficiency of each department and also the overall efficiency. Sales can also be checked against production. Abnormal losses should be investigated at once. The know]edge that records are being kept and that efficiencies are being calculated has a psychological effect on the factory staff and will help to increase efficiency and decrease losses by pilfering or worse. COSTINGS We are concerned here with the material cost of the finished product. To this material cost it would be the management's responsibility to add other charges such as labour, transport and overheads and with reference to transport this can be a very heavy item on small deliveries. Under present conditions when the cost of certain materials fluctuate considerably, the writer suggests the system of averaging. As each fresh delivery of a material comes in an average for value of stock and value of the new delivery is calculated and the new figure is used for costing. This system has the advantage of ironing out pronounced changes in value and gives the opportunity when prices are rising steadily to make necessary adjustments or notify the office of the need to increase prices. 254

RECORDS AND COSTINGS IN THE PERFUMERY AND COSMETIC INDUSTRY PERFU•IERY CO•IPOU•I)S It is advisable to cost these on a conservative basis. Losses from leak- ages, spillages, materials left in container, in filtration and deterioration because of long storage have to be allowed for. The amount of loss will naturally depend on the conditions under which the aromatics are stored, the care with which the compounding is carried out and the size of the batch. The writer considers that an allowance of 2• per cent should cover these losses, but he has heard of cases where the figure was 5 per cent. As liquids are normally measured, allowance for specific gravity of the aromatic must be made in calculating the weight. Where solids are used in the compound there is an increase of gravity, but after a series of tests and calculations it has been found that the cost corrected for gravity approximated so closely to the straightforward costing that it was not worth while making this correction. As mentioned in a previous paragraph, the ingredients are valued at the average value of all stocks of that article. The costing of compounds must include the labour charges in the opera- tion--because these are a much heavier item per fl unit of compound than the factory labour charges per tl unit of production. The labour involved on different compounds varies enormously, depend- ing on the size of the batch, on the number of ingredients and the amount of solids used. Experimental batches of, say, 4 oz. may take more time, owing to the necessity of accurate weighing and measuring, than a large batch. Dealing with the experimental batch first, this should be considered as research work and in a small factory should be included in overheads, as the work is for the benefit of the factory as a whole and cannot be charged against any one product. It is suggested that a rough estimate should be made periodically of the time spent on such work and that the total wages of the department be adjusted by this amount. Daily records must be kept of all the compounds made--these are totalled at the end of the four-week period--and a labour cost per batch figure can be calculated. This is the simplest method and gives a reasonably true figure. More accurate figures can be obtained by multiplying the number of batches by the number of ingredients in each compound and totalling the batch ingredients number, and dividing this into the wages to be accounted for. It is advisable for the compounding laboratory to have a stock card for each ingredient in stock. These would show particulars of purchase, source, price paid, and usages each four-weekly period. On these cards the average price of the stock could be entered. These cards would show how much of each ingredient was being used and would show when it was necessary to order. A check on stock could be made at any time. These cards act as a check on the compounding department working correctly as any errors in 255