CARE Food Manual (CARE , 1998, 355 p.) Chapter 7 - Storage and Handling (introduction...) I. Introduction II. Selecting Food Storage Facilities A. Criteria B. Types of Warehouse Space Available (introduction...) 1. Commercial 2. Government and Counterpart Storage Facilities 3. Transit Warehouses and Sheds 4. Open Storage 5. CARE Owned and Managed Warehouses a. Construction of Storage Space b. Prefabricated Warehouses C. Determining Warehouse Capacities/Storage Plan III. Preparing for Receipt or Dispatch of Food (introduction...) A. Arrival and Departure of Trucks B. Direct Dispatches to Beneficiaries C. Permanent and Temporary Warehouse Labor D. Equipment, Material and Pre-Printed Forms E. Warehouse Security 1. Theft 2. Fire Prevention IV. Food Storage A. Open Storage B. Height of Stacks C. Stacking Food D. Stack Cards E. Physical Counts (introduction...) 1. Physical Inventory is the True Balance 2. Physical Inventory Schedules 3. Reconciling Physical Inventories, Stack Cards, and Warehouse Inventory Ledgers 4. Filing Physical Inventory Reports V. Routine Procedures A. Maintenance and Cleaning (introduction...) 1. Maintenance 2. Cleaning B. Warehouse Inspections C. Preventing Damage and Loss D. Disposal of Empty Bags or Containers (introduction...) 1. Sale of Bags or Containers 2. Proceeds from Sales 3. Inventory Controls

CARE Food Manual (CARE , 1998, 355 p.)

Chapter 7 - Storage and Handling

Figure

I. Introduction

In this manual "warehouse" designates any area where food is stored. It may be a large structure with a roof, walls and a floor, a school or health post, a tent, or even an open area. It may be at a port or at a program site. Whatever the size and location of a warehouse, CARE must insure that the food resources can be received, adequately stored and dispatched for use in projects.

Currently warehouses are managed:

· By CARE staff at national, regional and local levels in CARE-owned or leased warehouses
· By national, regional and local government counterparts, mostly in their own warehouses
· By community leaders or other community groups in their own warehouses or small stores at distribution sites.

During emergency situations (especially start-up periods), meeting the basic requirements discussed in this chapter may not always be possible. Inform the donor in writing of any necessary limitations and obtain agreement or approval of all waivers in writing. Also inform the appropriate CARE International member. See Agreements and Contracts for more information about seeking waivers from donors.

II. Selecting Food Storage Facilities

A. Criteria

In choosing appropriate warehousing, consider the following:

· Companies and agencies already experienced in logistics with storage facilities available for loan or hire, such as port(s), railroads, agrobusinesses or commercial distributors

· Location and accessibility to rail, road, and sea or river, with ample space at warehouses for trucks to turn around and unload

· Location on high ground (if area floods) and terrain which is hard packed and does not become soft and muddy in rains

· Storage capacity in total square meters (See Determining Warehouse Capacities/Storage Plans below.)

· Structural layout and condition (roof, walls, fences)

· Security, including locks for doors; grates on windows; guards, if feasible and necessary. Warehouse compound should be enclosed by a security wall and, if possible, have perimeter lighting.

· Handling equipment, for main, large warehouses, e.g., forklifts, stacking conveyors

· Labor availability, both permanent and day labor for carrying bags or containers of food on and off stacks and performing reconstitution activities.

B. Types of Warehouse Space Available

Assessment should begin with an inventory of all facilities that may be available for storage of food at primary, secondary and distribution sites. In all cases, leasing arrangements or contracts for warehouse services must be in writing. See Agreements and Contracts.

1. Commercial

If commercial storage space is available, CARE should do an analysis of rental charges, and where appropriate, review rates with donors. Some country offices prefer not to rent warehouse space because of restrictions on the schedules of warehouse staff, limitations on use of equipment, incompatible systems for accounting and infestation control, and difficulties in collecting claims. However, these issues are usually negotiable if the warehouse is otherwise suitable.

Agrobusinesses and commercial distributors may have warehouses that can be made available temporarily for a short-term operation. Agricultural warehouses are often located close to rural production areas, while commercial distributors are generally in urban and town centers.

2. Government and Counterpart Storage Facilities

In many countries national, provincial, or local government stores are available. Encourage host governments and counterpart organizations to provide warehouse space at no cost before the project begins. If warehouse space must be rented or leased from the government, monthly fees should be nominal.

Local community leaders or associations can provide rooms in schools or churches, or village huts, in addition to local stores.

3. Transit Warehouses and Sheds

Some clearing and forwarding agents operate large transit warehouses for receipt, consolidation, and dispatch of cargo. Railroads often operate transit sheds to facilitate the loading and discharge of goods. However a transit shed is not a warehouse. It is meant for short-term storage only, and charges generally accrue on a daily or weekly basis. Transit sheds can be very expensive over extended periods of time.

Many different people may have access to transit sheds. CARE food could be stored together with non-CARE material, increasing the potential for loss or damage.

4. Open Storage

In emergency situations in remote regions, food may have to be stored on open ground without cover or security, thus more vulnerable to spoilage and theft. In these cases, finding high ground is critical. Open storage should be considered temporary.

5. CARE Owned and Managed Warehouses

a. Construction of Storage Space

Where there is insufficient or inadequate private or government warehouse capacity, country offices may have to consider constructing temporary or permanent warehouses.

Permanent structures should be built after all other possibilities for obtaining warehouses have been explored and usually only for long-term, emergency operations. In general, CARE should not be in the business of constructing and managing its own warehouses.

This will require the approval of CARE USA Headquarters, regional managers and donors where CARE USA is the lead member. Where U.S. Government food is programmed by another CI lead member, the Regional Manager at CARE USA Headquarters and U.S. Government donors must also approve any construction.

b. Prefabricated Warehouses

If building materials are not available locally or if time is a factor, especially in emergencies, use prefabricated storage facilities or even tents. A variety of prefabricated warehouses (e.g., Rubb and Viink Halls) with total capacities from 350-400 MT are available.

C. Determining Warehouse Capacities/Storage Plan

The amount of warehouse space required is based on the total volume of food and the different types of food. Information in this section is adapted from Part VI, Storage Specifications of the Commodity Reference Guide, Office of Food for Peace, Agency for International Development, January 1988.

Multiplying the length x width x height to the building eaves gives the gross volume in cubic meters, but a warehouse will never use all available space for food. There must be space available for working, ventilation, a space of about one meter between the stacks and walls, space to store materials and equipment for cleaning, and space to store materials used to repackage food.

General Guidelines for Determining Storage Space

· Allocate space for each type of food by shipment number, and all non-food materials and supplies related to food programs. If necessary, use chalk to mark the stack location on the warehouse floor. · Allow sufficient space for easy access to the stacks for inspecting, loading and unloading. Stacks should be one meter from the walls, with another meter between stacks. · Allow space for storage of cleaning materials and supplies. · Allocate areas for damaged food by shipment number. · Allow sufficient space to repackage damaged food and place it in separate stacks by shipment numbers.

Thus, while a small warehouse may have a gross cubic volume of 150 cubic meters, when taking into consideration the space between stacks, walls and the space between the stack and the eaves, its usable volume is only 48 cubic meters. In addition, non-food items and office space may take up another 15% or 20% of the usable additional space.

The following illustrations show gross dimensions of warehouses and how this volume is used when stacks of food are stored.

Figure 1: Warehouse with one stack of grain.

Figure 2: Warehouse with two stacks of grain.

Once usable volume has been determined, the next step is to calculate how much food can actually be stored in the warehouse. Use the following rules of thumb to estimate the usable space needed for different types of food:

· One metric ton of grain or pulses (twenty 50-kg bags) requires approximately two cubic meters of storage space, whether the twenty bags are end to end or stacked in layers.

· One metric ton of processed food, such as corn soya blends (forty 25-kg bags), will take up slightly less storage space because the bags are less bulky. There is less air and the grains are ground up.

· One metric ton of oil (44 cartons with six tins each) requires approximately 1.4 cubic meters of storage space, whether the 44 cartons are laid out end to end or stacked in layers.

· Similar calculations must be done for materials used to reconstitute damaged food, and for other non-food project materials and supplies.

If one MT of grain (twenty 50 kg bags) takes up approximately two cubic meters of volume, the small warehouse described above can hold 24 MT (420 bags) of corn. However, taking into consideration other possible space needs, subtracting another 5%, usable space may be reduced to approximately 68 cubic meters. In this case, the warehouse could only store around 23 MT of corn.

The illustrations below estimate usable stacking space for small, medium, large and warehouses, taking into consideration from 1 to 8 stacks. The illustrations do not take into account additional space requirements described in the above General Guidelines for Determining Storage Space.

Space Utilization - Usable Stacking Volume in Cubic Meters

Small Warehouse (Height = 3M)

Medium Warehouse (Height = 4M)

Large Warehouse (Height = 5M)

Eight stacks; four meter central gangway

III. Preparing for Receipt or Dispatch of Food

When the storekeeper receives notice that food will arrive, warehouse staff should clean and inspect the area where the food will be stored. Laborers should sweep the ceiling, beams, walls and floors. If necessary and available, use water. Adequate labor and equipment must also be available to move and stack food.

If food arrives without notice, storekeepers should quickly calculate space needs and clean areas before food is placed in the warehouse.

If food is to be stored outside, remove any trash or debris, and make certain that the storage area is level and well drained.

If storage space is rented, requisitioned or borrowed, inspect the area and arrange to:

· Repair roofs, doors, locks, and lighting
· Acquire pallets or dunnage to raise food off the floor
· Clear out partitions, machinery, or other equipment left in the storage areas.

A. Arrival and Departure of Trucks

Warehouse managers will have to develop procedures to assure smooth dispatches and deliveries. If there is only one loading dock or entrance to a warehouse, trucks arriving at the same time will have to line up to make deliveries or load up. If there are entrances to the front and back, trucks may use the front entrance to deliver food while other trucks are being used to dispatch food from the rear entrance. Wherever possible, warehouse managers should try to arrange for receipts and dispatches of food on separate days to avoid confusion and greater potential for losses or diversions.

In emergencies, food is often dispatched from port warehouses with multiple entrances or to compounds with a number of pre-fabricated warehouses. In these cases, port officer or warehouse managers should develop systems whereby trucks line up outside warehouse or compound perimeters. Drivers are given a gate pass that tells them which entrance or warehouse to go to and how much food to pick up. After loading, storekeepers sign the gate pass. Drivers proceed to an exit and show their signed passes and waybills to warehouse staff at the perimeter exit. Warehouse staff check the driver off their lists as the truck leaves the perimeter with its cargo. These procedures help to minimize confusion, control the flow of traffic in compounds, and limit the likelihood of diversion.

B. Direct Dispatches to Beneficiaries

In some cases, beneficiaries receive food directly from a warehouse. See Food Distribution to Sites for information on how distributions should be managed in these cases. See Food Receipt and Dispatch for information on how to document dispatches.

C. Permanent and Temporary Warehouse Labor

A successful warehouse operation depends on the people who work there. In addition to permanent warehouse staff, temporary laborers, often called casual or daily laborers, are employed when food is received or dispatched from a warehouse. They may help with cleaning and other warehouse maintenance tasks. Even though not full-time employees, they must be well trained in food handling and storage procedures, and able to identify damaged packages and infestation. They are also essential in repackaging damaged food.

Country Office Example

CARE Guatemala's warehouse manager identifies those daily laborers who perform well and continues to hire them when temporary workers are needed at the warehouse. Those who do not perform well are not re-hired. The laborers are also trained in stacking and handling food as well as in identifying damaged food and short-weight packages.

D. Equipment, Material and Pre-Printed Forms

Staff and workers need sufficient equipment, material and pre-printed forms to perform their duties. Needs depend on the size of the warehouse and the volume of food that is received, stored and dispatched. Obviously a small storage room at a health post will not require the same equipment and supplies needed in a large central warehouse. The following is a basic list of equipment and supplies:

· Pallets on which to stack food
· Scales for weighing
· Empty containers (bags, plastic gerry cans) and stitching materials for reconstituting food
· Pest and rodent control supplies
· Cleaning equipment and supplies
· Fire extinguishing equipment
· First aid equipment
· Desks/files for large and medium size warehouse records
· Calculator
· Pre-printed chemical treatment ledgers
· Pre-printed warehouse inventory ledgers
· Pre-printed stack and fumigation cards
· Pre-printed, pre-numbered Loss and Adjustment Reports
· Pre-printed, pre-numbered waybills.

E. Warehouse Security

1. Theft

The degree of security needed to protect stored food from outside theft depends upon conditions within a country. In some countries a fenced area with security guards may be required; in other countries, a locked warehouse may be sufficient.

Internal Control

Restrict warehouse access to those who actually operate the warehouse, including staff who inspect warehouses. A country office or counterpart manager must designate which staff can possess keys. Country offices should maintain current lists with the names of all persons at the national, regional or local levels in possession of keys. For monitoring purposes, this must apply equally to counterparts and community-based groups. Only one person should possess the keys to the warehouse at any time. Generally, this should be a person with overall responsibility for the operation of the area where food is stored. This could be the chief storekeeper or warehouse manager if food is stored in separate structures or the person in charge of a health post or community center if food is stored in a room of a building. Country office senior managers should make it clear to all warehouse staff, including community groups, that the person who possesses the keys is accountable for all losses within the warehouse.

2. Fire Prevention

Warehouse managers or storekeepers must insure that:

· There are materials and equipment available to put out fires such as fire extinguishers or buckets and hoses, if a water source is available.

· Fire extinguishers are inspected regularly to make sure that they work.

· Flammable materials such as fumigants are properly stored.

· Strict rules that prohibit smoking or cooking in or near the warehouse are enforced.

IV. Food Storage

A. Open Storage

If open storage must be used (especially in emergencies):

· Select a location on high ground that provides for drainage in rainy weather.

· Place stacks on pallets, concrete slabs, gravel or sand, wherever possible. At a minimum, place plastic tarpaulin on the ground.

· Use pallets and dunnage (loose material) to raise food at least 4 inches off the ground or whatever has been laid over the ground.

· Cover food with plastic sheeting, protecting tops and sides, and lash sheeting securely so that it will not blow off.

· Dig drainage ditches around the stacks to prevent entry of rainwater.

· Protect stacks from theft by using a fence or employing 24-hour security guards.

· Insure that stack cards are used and kept up to date. (See below.)

· Take daily physical inventories, by a CARE manager or a local counterpart representative, and reconcile physical counts with inventory ledgers.

Internal Control

CARE managers of open storage must account for food receipts and dispatches, report losses and maintain inventory ledgers as if the food were stored in a building.

B. Height of Stacks

Do not stack 6-tin cartons or pails higher than ten layers, or bags of grain and processed food more than 25 layers. If food is stacked higher, stacks can become unstable especially as food is put on or taken off. In addition, added weight may cause damage to bags or containers of food at the bottom of the stack.

C. Stacking Food

Whenever possible, use pallets to keep food off the floor, and keep stacks at least one meter away from the eaves of the warehouse. This allows air to circulate and helps reduce the risk of infestations. Pallets should be clean, level, and free of projecting nails or splinters. When pallets are not available, such as at the beginning of an emergency operation, try to place food on wooden planks, woven mats or plastic sheeting. Keeping food off the floor is essential.

Guidelines for Stacking

· Be sure there is easy access to food that has been stored the longest so that it will be dispatched first. · Store separate shipments of the same food in separate stacks. If this is not possible, place food remaining from a previous shipment on top of newly arrived food so that it can be dispatched first. · Set the first layer of the stack carefully on the pallets -- this layer is fundamental for maintaining uniform stacks. (See Figure 3 below.) · Bond or interlace layers bags of grain or processed food to construct the stack. (See Figure 4 below.) · Line up bags or containers of food with the edge of a pallet. (See Figure 5 below.) · Place the same number of bags or containers on each level to make counting easy. · Leave at least one meter between each stack, and between the stacks and walls to facilitate inspections, inventory counts and fumigations. Leave at least one meter of circulation space between the top of the stack and the eaves. (See Figure 6 below.) · Stack cartons or tins of oil in their upright position. · Limit stack heights to avoid crushing food on the bottom and excessive floor loading. Do not stack bags of grain or processed food higher than 25 layers, nor containers of oil higher than 10 layers. (See Figure 7 below for an example of a well constructed stack which also can be used like a staircase to easily put food on and take it off.) · Lift bags and containers and do not throw them. · Create separate stacks for food in original packages, damaged packages, repackaged food, food suspected and/or declared unfit, and sweepings. · Take physical inventories by counting from the floor. Climb to the top to observe that the stack is whole and no food has been taken from the center.

Figure 3a: Correct Stacking Sequence -- Bottom layer as seen from above

Figure 3b: Correct Stacking Sequence -- Top layer as seen from above

Figure 4: Bonded or interlaced stack

Figure 5: Stacking on pallets

Figure 6: Stacking food to eaves

Figure 7: Staircase Stack

D. Stack Cards

Each stack of food must have its own stack card. Stack cards record the receipt and dispatches of food on and off the stack and allow the warehouse manager or storekeeper to assess balances quickly without having to physically count. See Inventory Accounting and Reporting for information on how to keep stack cards.

E. Physical Counts

Internal Control

Warehouse managers and storekeepers take physical inventories as part of their routine responsibilities. These inventories and reconciliations, however, are not the same as independent inventories and reconciliations taken by independent persons for the country office. See Internal Control, Inventory Accounting and Reporting, and ALMIS 4496 -- the Commodity Accounting Manual.

1. Physical Inventory is the True Balance

The warehouse manager or storekeeper must insure that food balances shown on stack cards and in warehouse inventory ledgers reconcile with actual amounts of food in the warehouse. The actual amount of food counted in the warehouse is the TRUE balance.

If the physical counts, stack cards and ledgers do not reconcile and there is no justifiable reason for discrepancies, the person who has been delegated the duty of keeping the keys to the warehouse can be held liable for the value of any differences.

2. Physical Inventory Schedules

There is no set rule specifying when warehouse managers or storekeepers should take physical inventories and reconcile them with warehouse inventory ledgers. In warehouses where there is a lot of activity, inventories may be taken daily, weekly or bi-weekly. In other warehouses where there is not much activity, the warehouse manager or storekeeper may conduct physical counts monthly.

However, for purposes of better control, country offices should require that warehouse managers or storekeepers, at a minimum, carry out physical inventories at the end of each month. This will facilitate reconciliations with warehouse inventory ledgers and preparation of monthly Commodity Status Reports. (See Inventory Accounting and Reporting for more information on recordkeeping, inventories and preparing Commodity Status Reports.) More frequent inventories detect more quickly any differences
between actual stock levels and stack cards, and warehouse inventory ledger balances.

3. Reconciling Physical Inventories, Stack Cards, and Warehouse Inventory Ledgers

Normally, each stack is identified by location, shipment number and food type. (See an example of a Physical Inventory Form below.) The physical count is listed by shipment number and for each type of food. Counts should equal balances on stack cards and in warehouse inventory ledgers.

Where there are differences between counts and ledgers, warehouse managers and storekeepers must prepare and submit a Loss and Adjustment Report to an authorized person. Only when the Report is approved can the warehouse manager or storekeeper record the difference as a loss (or excess) in the warehouse inventory ledgers.

Figure 8: Counting a stack

To take the physical count of one section of the above stack (figure 8): A. add up the number of bags on the two rows completely interlaced ( 24 bags); B. count the number of blocks (2) at the end of the stack; and add up total number of rows in the stack - top to bottom (8). The stack has (24x2x8) = 384 bags.

Document the physical count on a form, similar to the one below and enter the physical count information for each stack on each respective stack card.

Note any differences between counts and stack card balances and briefly explain on the stack card. The Physical Inventory Form and Stack Cards will provide support documentation for physical inventory information entered in warehouse inventory ledgers.

PHYSICAL INVENTORY FORM

Warehouse Location _______________________

Month/Year:____________________________

Shipment #	Donor	Type of Food	Original		Damaged		Repackaged		Suspected Unfit		Declared Unfit		Sweepings		Total
			Units	Kgs	Units	Kgs	Units	Kgs	Units	Kgs	Units	Kgs	Units	Kgs	Units	Kgs
															0	0
															0	0
															0	0
															0	0
Total			0	0	0	0	0	0	0	0	0	0	0	0	0	0

Remarks*: _________________________________________
__________________________________________________

Name: _____________________ Signature: ______________

Title: __________________________

File: Warehouse Monthly Physical Inventory

*This section should be filled out when there is a difference the physical count and warehouse inventory ledger. Reasons should be given for any differences. When Loss and Adjustment Reports are prepared, the numbers of the report should also be included.

Document losses on the Loss and Adjustment Reports. See Losses and Claims for additional information.

4. Filing Physical Inventory Reports

Warehouse managers and storekeepers must maintain a file which contains monthly physical inventory reports. They may be included in a shipment file or kept separately, but they must be available for inspection by field monitors or other persons carrying out warehouse inspections.

Country offices should determine whether they also want to have warehouse managers and storekeepers submit reports to their Food and Logistics sections.

V. Routine Procedures

A. Maintenance and Cleaning

Keeping warehouses well-maintained and clean is critical to insuring that the maximum amount of food is available for distribution to program beneficiaries.

1. Maintenance

Warehouse managers and storekeepers must periodically examine the warehouse for structural deficiencies.

· Repair leaking roofs.
· Seal cracks in the warehouse floor, wherever possible.
· Close any openings in the eaves, walls or foundation where birds or rodents can enter.

2. Cleaning

Keeping warehouses clean reduces dust, cobwebs, bird droppings and the risk of insect and rodent infestation. The warehouse manager or storekeeper should develop a cleaning plan which assigns specific duties to warehouse staff. The following table provides one example for a cleaning plan.

Warehouse Cleaning Plan

Daily	Weekly	Monthly
Clean spillage as it occurs. Sweep the floor and dispose of the sweepings according to guidelines in Losses and Claims	Sweep walls and sides of stacks thoroughly. Clean debris in the area surrounding the warehouse.	Sweep roof beams. Clean ventilators.

B. Warehouse Inspections

Warehouse managers or storekeepers should assign someone to inspect warehouses routinely with the focus on cleanliness, maintenance of the structure, and proper storage and accounting practices. The following table lists areas of the warehouse to be inspected and evidence that may indicate problems. For an inspection checklist see Attachment, which is taken from CARE's Commodity Storage and Handling Manual, 1992.

Guidelines for Warehouse Inspections

Area to be inspected:	Inspect for:
Outside the warehouse	Cleanliness Condition of roof, walls and windows Security--fences, guards, locked doors and windows
Inside the warehouse	Condition and cleanliness of ceilings, floors and walls Adequate ventilation Placement of rodent baits/traps Presence of hazardous substances such as chemicals and pesticides Presence of fire extinguishing equipment, dates not expired
Food storage area	Distance between stacks, and between stacks and walls Interlaced or bonded stacks Use of pallets free of exposed nails or wooden splinters which may tear bags Segregation of damaged food Insect infestations -visual and sounds Rodent or bird infestations Stale food which has been stored too long Leaking, stained or discolored containers, bulging or rusting cans and caking of food within bags Germination of grain in sacks Short-weight containers
Warehouse office area	Cleanliness Adequate shelving Adequate lighting Condition of office equipment

C. Preventing Damage and Loss

Internal Control

Continually inspect food for damage. If damage is discovered, segregate the damaged from good packages. Depending on the type of damage, reconstitute, fumigate packages or dispose of the affected food in accordance with prescribed procedures. See Losses and Claims for information on repackaging or disposing of unfit food and Inventory Accounting and Reporting for recording transactions.

When inspecting stacks, climb to the top and spot check bags or containers underneath top layer, and from the side carefully look in between bags or containers.

Figures 9a, 9b, and 9c: Inspection of Stacks - (From CARE's Commodity Storage and Handling Manual, 1992)

Take action based on the guidance listed in the following table. The terms repackaging and reconstitution are used interchangeably.

Controlling Damage to Food

Type of damage	Evidence of damage	Methods of control	Action necessary
Short-weight containers	Bags appear slack. Containers are not as heavy as normal when lifted. Weighing a random sample of bags and containers indicates short-weight.	If bulk shipments, increase vigilance of bagging operation at port. Increase security in storage areas and during transport.	Repackage or assign a new weight to the containers. Prepare Loss and Adjustment Reports and enter transactions on stack cards and in warehouse inventory ledgers.
Leaking, broken or torn bags or containers	Spilled food in transport vehicle. Food spills from containers during unloading. Bags are torn and containers are dented or crumpled.	Handle properly--do not throw, stack too high or use hooks Contact donor if packaging material/container appears inadequate.	Repackage food fit for human consumption. Inspect sweepings and either reconstitute or dispose of sweepings declared unfit for human consumption. Prepare Loss and Adjustment Reports and enter transactions on stack cards and in warehouse inventory ledgers.
Wet, stained or moldy bags or containers	Containers are wet to the touch or dripping. Containers are discolored Unusual smell (moldy or chemical) Caking of food.	Ship in waterproof holds or in adequately sealed cargo containers. Keep under cover when stored outside. Transport using tarpaulins. Insure adequate air circulation. Do not store past expiration date on container. Refer to USAID Commodity Reference Manual and other donor guidelines on storage period for food.	Inspect and reconstitute food fit for human consumption; dispose of food declared unfit for human consumption. Food dampened by rain may be dried and reconstituted. Prepare Loss and Adjustment Reports and enter transactions on stack cards and in warehouse inventory ledgers.
Bulging or rusted tins	Rust on outside of container, especially near seams and lids. Shape of container is bulging and distorted.	Do not store in direct sunlight Do not store past expiration date on container or longer than four months.	Inspect and reconstitute food fit for human consumption; dispose of food declared unfit for human consumption. Prepare Loss and Adjustment Reports and enter transactions on stack cards and in warehouse inventory ledgers.
Rodent or bird infestation	Rodents or birds in the warehouse Excrement on the floor or stacks Gnawed bags or containers Footprints in dust Nests	Cleanliness and maintenance are critical to preventing infestations. Keep both the outside and the inside of the storage facility clean and free of debris. Close holes or openings in walls, floors and ceilings. If possible place screens over windows and ventilation openings. Cats are effective in controlling rodents. Traps can be set along the interior walls of the warehouse, at each side of every outside door, and in rafters. Insure that no poisons or traps are accessible to the cats.	Inspect and reconstitute food fit for human consumption; dispose of food declared unfit for human consumption. Prepare Loss and Adjustment Reports and enter transactions on stack cards and in warehouse inventory ledgers.
Insect or moth infestation	Flying insects Live or dead insects or larvae on the floor Traces of insects or larva in dust Grain bags have small holes and excessive dust Noise heard inside the bag Irregular holes in the grain or beans Strong odor	Cleanliness is critical to prevent insect infestations. Keep both the outside and the inside of the storage facility clean and free of dust and debris. See CARE's Commodity Storage and Handling Manual, 1992 for more information on fumigation.	Inspect and fumigate; dispose of food declared unfit for human consumption. Prepare Loss and Adjustment Reports and enter transactions on stack cards and in warehouse inventory ledgers.
Sweepings	Loose food from slack or torn bags on warehouse floors Loose food on warehouse floors after reconstitution	Keep bags of food from being handled roughly or moved too many times. Instruct laborers to avoid as much spillage as possible during the reconstitution of food.	Frequently sweep floors to keep them clean. Reconstitute all food that may be fit for human consumption. Determine if sweepings are unfit. Prepare Loss and Adjustment Reports and enter transactions on stack cards and in warehouse inventory ledgers.

D. Disposal of Empty Bags or Containers

Empty bags or containers of food may have a high resale value, depending on the type of container and market conditions in the country where the program is located. Each country office should establish guidelines and procedures for the disposition of empty containers in accordance with donor requirements. Although not specifically mentioned in donor regulations, a country office may choose to set aside some empty containers which can be used for future repackaging of food.

Whether bags and containers are donated or sold, the creative uses by beneficiaries is endless. Oil tins can be used or storage for flower pots, gallon oil tins can be cut up to make oil lamps, funnels, watering cans, card files, even fences. They can even be fashioned into little guitars. These make excellent presents and music. Tin cans can also be used as siding for houses. As you know, aluminum siding was very much in vogue in the USA in the 1960s. Bags also can be used for storage, mats on floors and in some cases they are even used for clothing by cutting out holes for arms and the head.

1. Sale of Bags or Containers

The sale of empty bags or containers should be coordinated among country office logistics, finance and administrative procurement staff. Before deciding whether or not to sell, program managers must determine if the benefits exceed the costs.

Factors to Consider in Selling Bags or Containers

· Value of bag or container in relation to the value of the food it contained. For example, in some countries the value of a pail that contained vegetable oil may be equal to 1/3 of the value of the oil. · Value of empty containers in general. In some countries empty sacks have a relatively high value, while in others the value is nominal. · Distance from a viable market or the likelihood that potential buyers will come to warehouses to pick up bags or containers. · How does sale affect local production of bags and containers? · Costs involved in selling empty bags or containers-- transport back to central store, labor, advertising, management, and inventory recordkeeping. · Experience of staff to manage sales. · Donor requirements and agreements with donors to sell.

Establish a tendering process similar to that used for the sale of food unfit for human consumption. Soliciting competitive bids minimizes the possible appearance of impropriety and maximizes the price for the empty bags or containers. The policies and procedures set forth in CARE USA's
Procurement Manual for Overseas Operations.

Obliterate donor markings on the containers with paint or a marker. Seeing containers in local markets whose markings have not been obliterated can create a wrong impression. If it is not feasible to obliterate the markings, notify the donor and reach an agreement in writing about how to proceed.

2. Proceeds from Sales

Deduct the costs incurred in selling the bags and containers from sales proceeds. Country offices and counterparts, as applicable, must follow all requirements set forth on the CARE Overseas Financial Manual when receiving and distributing proceeds received from the sale of empty bags or containers.

CARE Ethiopia Example

CARE Ethiopia has maximized the sales value of empty bags and containers and uses the proceeds to finance projects. CARE trucks, which normally return empty from secondary to primary warehouses, are loaded with empty bags and containers on the return trip. Once a sufficient stock is accumulated, bids are solicited from potential buyers and the award is given to the highest bidder. Potential buyers are invited to examine the bags and material prior to making their bid. A security deposit is required by those submitting bids. This helps to insure that the buyer is serious about the commitment and will take delivery at the time stipulated in the offer. CARE Ethiopia also requires the buyer to take delivery "as is." In other words, the buyer cannot select some bags and containers and reject others but must take the whole lot.

3. Inventory Controls

Controls must be put in place to insure accountability so empty bags or containers are not misappropriated. The same principles and guidelines for managing food in this manual apply.