ABC / XYZ analysis
The Analiz → ABC / XYZ Analizi page classifies products on two measures.
ABC: value
Section titled “ABC: value”Products are ranked by their expected consumption value over the forecast horizon (forecast quantity × unit cost).
- A: the products making up the first 80% of total value. Few in number, large in value.
- B: the next 15%.
- C: the remaining 5%. Many in number, small in value.
The class is given by the cumulative share of the products before it: below 80% A, below 95% B, otherwise C. With this rule the most valuable product is always A; a product with zero consumption value is C. Values are converted to the base currency at the run date’s rate. Worked example: How to do an ABC/XYZ analysis.
XYZ: regularity
Section titled “XYZ: regularity”By the coefficient of variation of past demand (standard deviation ÷ mean):
- X: below 0.5. Regular and easy to forecast.
- Y: between 0.5 and 1. Fluctuating.
- Z: 1 and above. Irregular and hard to forecast.
The matrix
Section titled “The matrix”The two classes combine into nine cells. Clicking a cell lists its products and shows the recommended stock policy. AX, for example, is both valuable and predictable and should never run out. CZ is both low-value and irregular; ask whether it is worth stocking at all.
Other views
Section titled “Other views”- Pareto curve: what share of products makes up what share of value.
- Class changes: products whose class changed since the previous run.
- Warehouse: By default classes are determined for the company as a whole. To classify each warehouse by its own consumption, turn on the option on the Settings page.