Define ABC Classes

Use the ABC Class Update (HAA) program to define the criteria for ABC classes, assign classes (A through J) to items based on these criteria, optionally update the cycle count frequency by ABC class, and print a report that lists all items by ABC class. See Background and Road Map for more information.

  1. Set your options:

    1. Click the Runtime tab to set runtime options. See Set Options for Reports and Inquiries for more information.

    2. Click the Selection tab to select specific records.

    3. Click the Program tab to set these program specific options:

Field Name

Type / Max Length

Action / Description

Enter output device for report

Conditional

Select the output device for the list of items whose ABC classes changed during the update.

Select method

Required
1 numeric

Select the method you want to use to assign classes:

  • C Cost
    The higher the standard unit cost of an item, the higher its classification.

  • U Usage
    The program multiplies the item's standard unit cost by the actual sales and manufacturing usage.

    For the Select number of months to use option, you must enter the number of months of history in addition to the current month.
    Items with a high standard unit cost and frequent usage will be assigned to class A. However, items with a high standard unit cost and low usage or low standard unit cost but frequent usage may also be assigned to higher classes.

  • Q Quantity
    The program multiplies the item's standard unit cost by the quantity in inventory.

    Items with a high standard unit cost and high on-hand quantity will be assigned to class A. However, items with a high standard unit cost and low on-hand quantity or low standard unit cost but high on-hand quantity may also be assigned to higher classes.

Select number of months to use for usage

Conditional
2 numeric

If you selected U for U=Usage or Q=Qty OH, enter the number of months from 1 to 12. If you enter 1, the program considers only the current month (which may be a partial month).

The program applies the breaks you specify for the Class x fall under % break option based on the cost times the quantities used for the number of months you specify here.

Class A fall under % break

THROUGH

Class J fall under % break

Optional
5 numeric in the format 100.00

Enter the upper limit for each class. Each percent must be larger than the previous, with the last being 100.00. If you do not enter 100.00, the program will fill it in for you.

You do not need to use all ten codes. For example if you want these ranges for classes A, B, and C, you could enter:

Class

For

Enter

A

.00-70.00%

70.00

B

70.00-90.00%

90.00

C

90.00-100.00%

100.00

See Background for more information.

The program calculates a value, using the method you select in Program options, and applies these percent breaks to it.

For example, if you select the cost method and enter 70.00 for your Class A fall under % break, the program sums the costs of all inventory items and processes them in descending sequence of value. It assigns class A to items the top 70%.

    1. Click the Program2 tab to set these program-specific options:

Field Name

Type / Max Length

Action / Description

Exclude make items?

Optional

Select if you do not want items that you make or leave blank if you do.

Make items have an M in the Make/Buy/Kit field in the Enterprise Item Maintenance (IM) program.

Exclude buy items?

Optional

Select if you do not want items that you buy or leave blank if you do.

Buy items have a B in the Make/Buy/Kit field in the Enterprise Item Maintenance (IM) program.

Exclude kit items?

Optional

Select if you do not want items that you kit or leave blank if you do.

Kitted items have a K in the Make/Buy/Kit field in the Enterprise Item Maintenance (IM) program.

Update cycle count freq by ABC class?

Optional

Select if you want to update the Count freq field in the Branch Item Maintenance (IMB) program or leave blank if you do not.

Class A cycle count frequency

THROUGH

Class J cycle count frequency

Optional
3 numeric

If you selected Update cycle count freq by ABC class?, enter the number of calendar days (1 to 999) each class is be counted or leave blank if you do not want the program to update the physical count frequency for items assigned to an ABC class.

For example, enter 90 to count items in this class every 3 months.

  1. Choose the appropriate options:

To

Do This

Process the update request

Click Process. A report of proposed new ABC classes is printed, followed by the prompt:
Enter PROCEED to update inventory file
Type the word "proceed" in uppercase letters to update ABC classes or tab at a blank entry to exit the update process.

Save these options for future use

Click Save.

Exit the program

Click Exit.

If you click View or Print and you previously exited the program without erasing the workfile, the program prompts Previous workfile exists.

  1. (Conditional) Click Print to print the existing report, click Erase to erase the workfile and create a new report based on the criteria you entered, or click End to exit the program.

Note
When you click Print or Erase, the report prints immediately if the option Allow device override? in the Date-Output Device Maintenance (ZE) program is not selected.

If this option is selected, the program prompts Output device. Accept the default device that displays, which is specified in the Date-Output Device Maintenance program, or enter the name of a different device.

After the report prints, the program prompts Erase workfile?

  1. Click Yes to erase the workfile or click No to retain it.

  2. Click Exit to exit the program.