What is ABC procurement?

The same goes for ABC control.

The ABC method of inventory management is a system that manages inventory. It can also be used to control materials and distribute the goods. This is also known by SIC or selective inventory control.

The next question is: What is ABC analysis? And how does it work? ABC analysis is a system of inventory control that can be used in materials and distribution management. Sometimes, it is also called selective, or SITC. It doesn't matter what kind of inventory you have, this approach works by grouping them all into three distinct categories.

What is an ABC Analysis example?

ABC analysis divides inventory into three categories. Class A a represents 15% to 20% of stock quantity, but commands 80%-85% of the value. Class B is 30% to 35% stock quantity, but commands 10% to 15% value. Class C a is the most valuable class, but it makes up only half of the stock quantity.

How can you classify ABC inventory

These are the steps for conducting an ABC analysis:

1. Each item's annual sales or usage should be determined.
2. Calculate the percentage of total usage or sales for each item.
3. Sort the items by highest to lowest percentage.
4. Sort the items into groups.