Option 6Generate Product ABC Classes

This function is used to generate product ABC classes for the Products By Warehouse file. The ABC classes can be based either on year-to-date dollar sales or on the inventory value (Total Cost) in the Products By Warehouse records.

Product ABC classes can be changed for specific warehouses, product classes, or physical types, or even throughout the entire system.

This function does not change product ABC classes in the Products file.

Here is an example of how you might use the Product ABC classification:

Class Percentage A 10% B 40% C 50%

Assume that the total YTD Sales for all Products By Warehouse records equalled $1,000,000. Starting with the highest YTD Sales figures, all records that make up the top 10% (or $100,000) of that overall figure would be classified as Class “A” products.

Those records which make up the next highest 40% (or $400,000) of the YTD Sales figures would be classified as Class “B” products.

Finally, the records that make up the remaining 50% (or $500,000) of the YTD Sales figure would be classified as Class “C” products.

The following screen allows you to generate Product ABC classes.

Generate Product ABC Classes screen

Data items for the preceding screen are described below:

Percent of Dollar Sales

The system displays ‘N’ for this field. Enter ‘Y’ or ‘N’ to indicate whether or not the ABC class is based on the total year-to-date sales dollars generated by the product.

Percent of Inventory Value

The system displays ‘N’ for this field. Enter ‘Y’ or ‘N’ to indicate whether or not the ABC class is based on the total inventory value (total cost) of the product.

Enter Percentages

Enter up to 2 digits and 1 decimal for each percentage breakdown for the three classifications. That is, enter the percentage of sales or inventory value that qualifies a product for classes A, B and C. The total of the three percentages must equal 100%.

Press RETURN to complete the function.