ABC Classification System

ABC Classification System

Describe the ABC classification system. What is the purpose of classifying items in this fashion? What would be the primary value of ABC analysis to a retailer? To a manufacturer?

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ABC classification is a system used to categorize items in accordance to their importance in achieving a businesses’ goal. The system categorizes items into three classes:

1. A ITEMS: Outstandingly important
2. B ITEMS: Moderately important
3. C ITEMS: Relatively unimportant

             Each class here requires different organization and control. A items are those items when used in small numbers produce very high returns. Therefore, they are the most…………….

APA

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