Calculate and Update the ABC Code
The ABC code is used to categorize inventory items based on usage. It’s a key factor in determining how often an item gets cycle counted. Learn how to calculate an ABC Code, compare it to the current code and post an update if necessary.
In INDUSTRIOS an ABC code can be assigned at the Item Master level and at the Item Location level – allowing for different ABC assignment based on location.
The ABC Code is calculated using the Inventory Analysis Type and Calculation. ABC codes must already be defined and the percentage of value fields on all ABC keys should total to 100%. An Analysis Location master file must also exist.
Here are the steps to calculate an ABC code:
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Create a new Inventory Analysis Type for calculating ABC code.
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On the ABC Activity Analysis Tab, select to calculate ABC Key.
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Select whether to update the ABC in the Item Master, the Item Location or the Default Analysis Location. If Default Analysis Location is selected, the posting will update the Location ABC Key for only the location flagged as the default on the Analysis Location master file.
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Select the cost method to use in valuing the inventory items.
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In the Usage field, select which types of transactions should be considered as usage of the item.
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Should the calculation ignore negative adjustments?
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On the Snapshot Criteria Tab identify the items and locations to be included in the calculation.
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On the Inventory Analysis Workbench, create a new analysis with the Type created in the steps above.
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Create the Snapshot and review the results on the Inventory Analysis Details Tab. The current ABC Key and Calculated ABC Key are displayed. (These columns are normally displayed on the far right of the grid. For illustration purposes, they have been dragged to the left).
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Tag the lines you wish to update and set the posting flag.
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Post the update from the Inventory Analysis Tab, ensuring you select the option to update the ABC Key.
