Configure ABC Classification

ABC Classification is used to manage inventory by dividing materials into categories (A, B, and C) to designate importance. A usually denotes material items of the most importance, while B and C denote material items of lesser importance.

PREREQUISITES:

  • You must be a Domain Administrator to configure the ABC classification on the Material page. See Add a Domain Admin for more information.
  1. Open the menu.
  2. Tap Config and tap Material.
  1. Tap ABC Classification to open the ABC Classification panel.

  1. Enter the Start Date. This date defaults to the previous fiscal calendar year.
  2. Enter the End Date. This date defaults to the current fiscal calendar year.
  3. Enter the Cutoff A %. Class A is usually composed of the top 10% materials that generates 70% of the material costs. This field automatically defaults to 70.
  4. Enter the Cutoff B %. Class B is composed of the next 20% materials that generates 20% of the material costs. This field automatically defaults to 95.

NOTE: The value entered in the Cutoff A % field must be less than the value entered in the Cutoff B % field.

  1. Tap Preview to view the Class, Material Sid and Material Uid, cost of the material over the selected date range, and the percentage of the total cost that the material accounted for.

A running total of all the costs from Storeroom issue transactions within the date range is calculated. The materials that account for the first Cutoff A % percent of the costs are classified as A, the remaining materials that make up the Cutoff B % percent of the costs are classified as B. Any other materials that were issued during the date range are classified as C, and any materials not issued in the date range are classified as NA (not applicable).

  1. Tap Commit to commit the classification(s) to the database. By committing the classification(s) any previous classifications will be overwritten.