ABC Analysis

Quickest way to perform ABC Inventory Analysis - Based on Value, Volume and Frequency of Sales

ABC inventory analysis is a process of classifying the products based on the value of importance. This concept is derived from the Pareto principle of 80/20 rule which focuses on vital few from trivial many. Not all items in an inventory are of the same value, therefore these items are broken down into three categories A, B and C. Class A consists of most valuable items, although these items constitute only 10% of quantity they account for 70% – 80% of consumption value. Class B consists of items with moderate importance accounting for 10% – 20% of revenue. And class C consists of least valuable items that contribute to only 10% of revenue. This classification helps managers in prioritizing and monitoring items of high importance closely.

Please refer to Quickest Way to Perform ABC Inventory Analysis- Based on Value, Volume & Frequency of Sales, and use the Free Tool mentioned in this performance to conduct ABC Inventory Analysis very quickly.

To learn Inventory Management in a lot more details, please refer to The Ultimate Guide to Inventory Planning Methods

You need to be SCMDOJO Member to access Tools for FREE
Limited Time Offer

To understand your current knowledge and skills status I have designed this Materials Management Competency Assessment tools.

To deploy a successful Sales and Operations Planning Process, we have built this simple yet very effective S&OP Maturity Model Self-Assessment tool