Why is abs analysis needed? Multivariate ABC analysis

Today, the essence of assortment optimization work increasingly comes down to identifying and developing the most profitable product groups. It is not necessary to use complex marketing theories. As a basis, you can take, for example, data on profit by product groups and use the ABC analysis technique. Let's take a closer look at how to analyze the product range using only basic financial indicators.

In this article you will learn:

The product range of many companies was formed spontaneously. New suppliers and brands, new product range were added. A large assortment served a large trade turnover. But at the same time, all this required large financial resources for purchase, production and warehousing. Today, this is an unaffordable luxury for companies, many of which are experiencing a shortage of working capital.

The main signs of an unsuccessfully selected product line:

• an increase in warehouse balances both in kind and in value terms and at the same time a lack of goods in demand by customers;
• an increase in the number of positions accompanied by a decrease in profits;
• lack of resources for procurement.

Moreover, expert methods, when the assortment is formed only on the basis of the opinion of sales department managers, do not work in the case of a large number of product names. A rigorous mathematical approach is required. In fact, the essence of the work on optimizing the assortment is often closer and clearer to the financial director than, for example, to the head of the marketing department, and boils down to identifying profitable product groups and, accordingly, developing them; carefully curtailing the remaining ones.

Personal experience
Mikhail Podlazov,
Before optimizing the product range, it is necessary to determine what the company plans to achieve. As a rule, enterprises pursue three key goals: increasing revenue and profitability of sales, optimizing inventory finished products, expanding sales markets and conquering new ones.
At Nidan Juices, before making adjustments to the product portfolio, four key indicators are assessed and analyzed:

• arithmetic average sales volume;
• product line size;
• warehousing, transport network and production capabilities;
• profitability.

Example of ABC analysis of product groups

How it will help: Maximize profits by managing inventory and avoid keeping money in stock.

How it will help: identify and eliminate excess inventory, implement a system for monitoring and optimizing inventory.

So, to conduct an ABC analysis, you will need to determine the profit generated by each specific group of goods, its specific gravity in the total amount of profit and rank the groups according to this indicator, and also calculate the share in the profit as an accumulated total (see Table 1).

Table 1. Example of ABC analysis for product groups

Serial number in assortment	Product rating based on the “profit share” indicator	Group name	Profit for the first half of 2009, rub.	Share in profit, %	Share in cumulative profit, %	Profit category
10	1	Beer	3 324 754	20,7	20,7	A
14	2	Perfumes and hygiene	2 157 010	13,4	34,1	A
1	3	Alcohol	2 040 270	12,7	46,8	A
12	4	Snacks	1 504 268	9,4	56,1	IN
3	5	Soft drinks	1 482 471	9,2	65,3	IN
5	6	Confectionery	1 469 275	9,1	74,5	IN
8	7	Meat products	1 205 017	7,5	82,0	IN
11	8	Cigarettes	1 093 273	6,8	88,7	WITH
4	9	Frozen food	724 245	4,5	93,3	WITH
2	10	Grocery	332 012	2,1	95,3	WITH
13	11	Juices	270 044	1,7	97,0	WITH
9	12	Household products	201 096	1,3	98,2	WITH
7	13	Milk products	191 609	1,2	99,4	WITH
6	15	Coffee Tea	80 046	0,5	99,9	WITH
15	16	Bread	10 832	0,1	100,0	WITH
TOTAL			16 086 221	100

It’s worth saying right away that ABC analysis using the example of a company’s assortment involves identifying groups in slightly different proportions than what is suggested classic rule Pareto. When conducting ABC analysis, it would be quite justified to use the following criteria:

• Category A – groups with the largest contribution to profit (share in profit), which together provide up to 50 percent of the company’s total profit;
• Category B – product groups that in total provide about 35 percent of the profit, and their accumulated share in the profit ranges from 50 to 85 percent;
• Category C – groups with the lowest share of profits, bringing in the remaining 15 percent (cumulative share from 85 to 100 percent).

By the way, at the stage of analyzing the share in the profit of each product group, it would be useful to compare the data obtained with similar indicators, for example, for the same period last year. A decrease in the share of profit may well indicate a post-crisis reduction in demand for certain goods, and it is advisable to take this trend into account in further work on optimizing the assortment.

Personal experience
Mikhail Podlazov, Deputy General Director for Economics and Finance "Nidan Soki"
For us, the profitability of a product item is one of the most significant indicators that allows us to judge the need to produce a particular item. There were precedents when a company refused some product items due to their low profitability in the practice of Nidan Juices. Thus, two product items in a product line that included 8 product items demonstrated low profitability for six months. The reason is large losses when reconfiguring equipment and high price packaging. The financial service has calculated that to reach the minimum required level of profit, it is necessary to increase the sales volume of each product item by 80 percent.
In a competitive market, this was impossible to do, and the company had to abandon the production of these two product lines. Of course, indicators such as sales volume, product line size, warehousing, transport network and production capabilities were also taken into account. After the decision to reduce product items is made, the available raw materials are used only for the production of unprofitable SKUs. Then the equipment is reconfigured and production schedules are changed. The final stage is adjusting price lists and removing remaining products from store shelves.

After conducting an enlarged ABC analysis (example above), it is necessary to expand and increase the depth of groups that are strong in terms of profitability and reduce financially disadvantaged categories.

Optimization of the most profitable product group

Product groups allocated to category A bring the company half of all profits, and their optimization should have the greatest effect. But in order to work with this group, you will have to analyze its composition.

Let us immediately make a reservation that a product group can be homogeneous in composition, such as “beer” or “juices”. In them, products will differ only in brand, taste or package size. Or the group contains subgroups. For example, the group “perfumery and hygiene” contains subgroups “soap”, “wipes”, “shampoos”, “deodorants”, etc. In order to organize all this, the concept of width and depth of assortment is most often used. The width is determined by non-interchangeable subgroups of goods. For example, for the product group “shoes” the width of the assortment will be subgroups: “winter”, “summer”, “beach”. The depth is determined accordingly by interchangeable goods. They are usually located within a subgroup. For example, goods in different packaging volumes or similar in characteristics, produced under different brands.

So, optimization of group A implies that the width and depth of the group should be maximized. In practice, most often it is justified to keep no more than 6–7 positions in one depth subgroup, but there may be exceptions in relation to group A. This is the key idea of ​​optimizing the range of goods that bring the greatest profit, and the algorithm for reducing unprofitable items for the company will be as follows.

Step 1. Checking the number of items in subgroups. Within the category A group, ABC analysis is carried out, an example of which was described above. The point is to determine the subgroups of category C and check the number of items according to them.

By universal rule the number of items in each subgroup assigned to this category should not exceed the product of the number of product items in group A multiplied by the share in profit. For example, if the entire group A, in particular “perfumes and hygiene”, consists of 300 items and includes such subgroups as “shampoo”, “nail polish remover”, “soap”, “ toothpaste", etc. Moreover, the subgroup "nail polish remover" was classified as category C (profit share 0.9 percent). Accordingly, there should be no more than three types of nail polish removers (0.9: 100 X 300 = 2.7). If this is not the case, their number will have to be reduced. To make a choice, an ABC analysis is carried out for specific product items - the next step.

By the way, if the number of items in the studied group of category A is less than 50 items, then the first step can be neglected and immediately proceed to the analysis by product items.

Step 2. Analysis of names. The logic of actions at this stage is the same - ABC analysis of the share of profit, with the only difference being that the object is an analysis of specific product names (see Table 2). Category C falls under the reduction. Although there are some exceptions that need to be taken into account, namely:

• If the company’s situation is not critical, you should not remove products that were launched recently from the assortment. It is clear that the profit on them is lower, if only because they are sold for less time than all the others;
• Category C may include accessories and related products that stimulate sales of category A.

table 2. Example for product names of the “shampoo” subgroup

№	Subgroup	Profit for the first half year 2009, rub.	Share in profit, %	Share in cumulative total profit, %	Profit category
1	Shampoo "Nivea" dmuzh 250 ml	58 636	16,86	16,86	A
2	Shampoo "Nivea" dry 250 ml	49 985	14,38	31,24	A
3	Shampoo "Nivea" for hair	41 090	11,82	43,06	A
4	Shampoo "Nivea" with extension 250 ml	27 551	7,92	50,98	A
5	Shampoo "Nivea" fat vol 250 ml	26 211	7,54	58,52	A
6	Shampoo "Nivea" dmuzh 250 ml	19 582	5,63	64,15	B
7	Shampoo "Nivea" for perch. with extber 250 ml	18 451	5,31	69,46	B
8	Shampoo "Nivea" volume 250 ml	17 351	4,99	74,45	B
9	Shampoo “Belito” kefir 500 ml	17 107	4,92	79,37	B
10	Shampoo "Belito" brewer's yeast	15 165	4,36	83,73	B
11	Shampoo “Belita exclusive” eggs 585 g	13 459	3,87	87,60	B
12	Shampoo “Daf” osvmilvol 200ml	8646	2,49	90,08	C
13	Shampoo “Belito exclusive” henna 585 g	7729	2,22	92,31	C
14	Shampoo “Timotey” Cherry/cotton 400 ml	7217	2,08	94,38	C
15	Shampoo "Palmoliv" for color hair	5250	1,51	95,89	C
16	Shampoo “Timotey” henna 400 ml	4811	1,38	97,28	C
17	Shampoo “Palmoliv” for blonde hair	3937	1,13	98,41	C
18	Shampoo "Nivea" for normal hair	2849	0,82	99,23	C
19	Shampoo “Daf” dokr vol 200 ml	1312	0,38	99,61	C
20	Shampoo "Antoshka" club 320 ml	1239	0,36	99,96	C
21	Head & Shoulders shampoo basic care 200 ml	132	0,04	100,00	C
TOTAL		347 712	100

It would also be justified to reduce the range of items that fall into category C, getting rid of “unstable” products. We are talking about those titles whose sales fluctuate greatly from month to month. It is quite risky to bet on it, since in case of unfavorable developments it threatens to overstock warehouses and increase the volume of illiquid assets, in a word, significant losses for the company.

To assess the stability of sales, XYZ analysis is used. For each product of the analyzed group, the coefficient of variation is calculated (shows the degree of deviation of the data from the average value) using the following formula*:

where x i is the sales volume for the product for the i-th period;

x is the average sales volume for the analyzed product;

n - number of periods.

Data on sales of group products for several periods are used as initial data. Sales volume can be calculated in rubles or in physical terms. Although the latter is preferable. The fact is that if the company has recently revised its pricing policy, the results will be incorrect.

Two important remarks. Firstly, the number of periods must be at least three. Secondly, for products with pronounced seasonality, the period must be longer than the seasonal cycle. Another option is to use periods within seasonal upswings (or downturns, respectively).

• X – variation does not exceed 10 percent. Stable sales are therefore the main concentration of effort and resources. Such a product does not promise large losses for the company, even if it is purchased (produced) in a larger volume than required:
• Y – variations within 11–25 percent. A less stable category than X, but still a fairly reliable product;
• Z – spread exceeds 25 percent. It is better to remove such a product from the assortment or work with its supply (production) to order.

* The formula for calculating the coefficient of variation can be otherwise represented as the ratio of the standard deviation to the average value of the indicator. In Excel, the standard deviation is easy to calculate using the “STANDARD DEVIATION” formula.

Table 3. Sales stability analysis

Name of product	Sales volume, rub.			Standard deviation	Average value, rub.	Variation, %	Group
	IV quarter 2008	I quarter 2009	II quarter 2009
3	116 285	114 926	116 195	760	115 802	1	X
5	47 818	50 697	48 299	1542	48 938	3	X
1	305 922	276 658	335 817	29 580	306 132	10	X
6	34 500	27 865	32 289	3379	31 551	11	Y
8	37 929	36 685	30 750	3837	35 121	11	Y
2	255 420	245 089	327 870	45 108	276 126	16	Y
4	79 036	48 999	102 571	26 851	76 869	35	Z
7	12 346	33 786	32 502	12 025	26 212	46	Z

What to do with products that bring in 35 percent profit

So, we’ve sorted out the groups classified as category A. A slightly different approach is applied to category B group - in table. 1 these are “snacks”, “soft drinks”, “confectionery”. The sequence of actions may be as follows.

1. ABC​-analysis of names. It is quite justified to conduct an analysis immediately by product items for the entire group, without breaking it into subgroups. We will definitely leave category A positions. From the remaining products of categories B and C we will have to complete the assortment.

2. Select related products. If you focus only on profitable positions and there are no related products (services) in the assortment, then instead of increasing sales, there will be a decrease in revenue.

There are two ways to identify them. Firstly, using expert advice, you can force such a sample of marketing department employees to conduct such a sample. Secondly, related products can be found by conducting cross-analysis. It is done by analyzing receipts in retail or by analyzing invoices in wholesale companies. The point is to collect data on which kits are most often purchased. And as a result, keep in the assortment those items from category B that are most often purchased with category A.

3. Keep products stable. Based on the XYZ analysis discussed above, categories X and Y are returned to the assortment, regardless of sales volume and profit margin. If some products consistently (plus/minus 10–25%) bring the company a profit, albeit small, from month to month, it will most likely be inappropriate to refuse them.

4. Increase the depth of category A groups. Let’s say that in the “juices” group, category A includes cherry, orange and apple juices of the same brand. This is a reason to add other flavors of the same trademark from category B.

5. Identify product items that are significant for the buyer. There are several categories of products that should be in stock:

• “traffic generators” is a category that provides a flow of buyers. These are goods with high frequency purchases. However, they do not necessarily bring significant profits. But when customers come for them, they acquire other items along the way;
• “cash generators” is a category that provides a large volume of sales, that is, it has the maximum turnover in the group’s assortment. In conditions of liquidity shortage, it is important not to exclude it in the pursuit of profit;
• “Defenders” is a category of goods for which the buyer makes a conclusion about the general price level in the organization. For example: “milk is cheap, butter is cheap - which means you can look at the price tags with less bias.” As a rule, it is built on a price basis from goods that are traffic generators.

The marketing department will also insist that image products be sold. How justified this is in category B depends on the business strategy and its resources.

Personal experience
Dmitry Ivanov, Chief Financial Officer of Wimm-Bill-Dann
Wimm-Bill-Dann has more than a thousand products. Of course, the idea of ​​reducing and optimizing the range would seem obvious. This will automatically lead to a reduction in the required warehouse space, eliminating the need to work with a huge number of purchased raw materials, equipment changeovers, non-liquid stocks, etc. But we must not forget that products support each other. You cannot significantly reduce the number of items without losing revenue. When a customer comes to a store, he should see, for example, ten varieties of juices. If there are fewer of them, you take up less shelf space, you are less visible, you are bought less and, therefore, your market share is smaller.
But I would not categorically state that the assortment cannot be reduced. This can be done, but with extreme caution. If you reduce the number of juice brands from ten to nine, this is quite acceptable. This is exactly what we do periodically, trying to save our pennies. But reducing the range to six types of juices is a big mistake. Such optimization will have an extremely negative impact on the company’s revenue. In other words, you can cut your product line by 10 percent, but not by 20 percent, relatively painlessly.
In Russia, more than 25 percent of the market is for orange juice, approximately 25 percent for apple, the same for tomato, and peach and other flavors occupy the remainder. However, we cannot limit ourselves to these names. Our consumers want to see variety.

6. Save new items. Regardless of the situation in the company, its financial position will be more stable if new products are periodically introduced into the assortment. The fact that some product is profitable now does not mean that tomorrow customers will lose interest in it. In order not to miss the moment of “degeneration” of “profit generators”, you need to regularly analyze the sales results for the main products (at least once every six months or a year), and track changes in the share of profit.

All other products from category B can be thrown away and disposed of.

What products should be excluded from the assortment?

It is better to completely exclude category C groups identified during the preliminary analysis of the assortment and not waste the company’s financial resources on them. Of course, making exceptions for items that have recently appeared in the assortment, they are important related products for category A, traffic generators.

Expert opinion
Alexey Fedoseev, General Director of the Intalev group of companies
A number of our clients are deliberately reducing the number of brands and suppliers they work with. Moreover, all this is done in order to optimize costs as much as possible. Many have finally begun to calculate the cost of commodity items, which almost no one had done before. It turned out that a number of brands are very expensive. One client of ours reduced the number of suppliers of non-fungible goods from 150 to 10. Its revenue in the next quarter was down 20 percent and its profit fell 3 percent. This was done last year, before the crisis. But due to the fact that the company began to work more efficiently with its remaining clients, profits increased by 40 percent in the next quarter.
The company began to receive large discounts for purchase volumes and large retro bonuses. Of course, the measure was risky. Throughout the quarter, the company's managers were, to put it mildly, in a state of stress - whether it would work or not, they were constantly monitoring the market reaction. But in the end, the reduction in assortment paid off, although one or two product items were returned at the end of the quarter.

Golubkov E.P.,
Honored Scientist of the Russian Federation,
d.e. Sc., Professor of the Academy of Economy under the Government of the Russian Federation

Methodological issues of conducting ABC and XYZ analysis and combining the results of these two types of analysis are considered. The areas of application of ABC and XYZ analysis are indicated, their advantages and disadvantages are noted.

1. Guidelines for conducting ABC analysis
ABC-analysis is an analysis of the assortment, sales volume various groups consumers, inventory by dividing them into three categories (classes), which differ in their importance and contribution to the turnover or profit of the enterprise: A- the most valuable, IN- intermediate, WITH- least valuable(1).

ABC- analysis regardless of the scope of its application ( manufacturing enterprises, trading wholesale or retail enterprises) is carried out in the following sequence.

1. Selection of the object of analysis (we determine what we will analyze - assortment group/subgroup, product range as a whole, suppliers, customers). It is possible to detail the areas of analysis by sales channels and market segments.

2. Determination of the parameter by which the object will be analyzed - average inventory, rub.; sales volume, rub.; income, rub.; number of sales units, pcs.; number of orders, pcs., etc.

Finding the only parameter that uniquely reflects the position of the analyzed goods represents difficult task. This choice depends on a number of factors: type of enterprise, turnover rate, seasonality of demand, etc. As a result, empirically you can try to use different parameters and even identify groups ABC based on the sequential application of several parameters, say, the number of orders shipped, income, number of sales units. As a result, integral groups can be distinguished A, B, C. Previously, the entire possible set of analysis parameters can be ranked according to their importance to select the most preferable ones. For example, the paper provides the following arguments in favor of the choice of evaluation parameters. In a pharmacy they can buy 100 packages of dietary supplements of the brand in a month X and 150 packages of dietary supplements brand Y.

(1) Abbreviation ABC has another interpretation: ABC - activity based costing- operationally oriented cost accounting. In Russian terminology - functional-cost analysis. The main object of management in this approach is recognized not as organizational and production systems, but as the operations performed by them.

It would seem that we need to focus on Y, since more of them were purchased. However, 150 packages of dietary supplements of the brand Y was purchased by only 6 customers - 5 people bought 10 pieces and one bought 100 packs. Dietary supplement brand X 10 people bought 10 packs each.

If you focus on pieces as a significant parameter, you can easily make mistakes when planning purchases. After all, this one client (who bought 100 dietary supplements at once Y) might not appear, and the likelihood that the same customer with the same amount of purchased will appear in the next time period is very low. Conclusion: you cannot focus only on the number of packages. Focusing on the fact of sale guarantees greater accuracy in purchasing.

The cited work proposes a two-factor model ABC-analysis, in which profit and the number of sales facts are used as parameters. Profit is given preference over turnover, mainly due to the fact that many goods are sold at different markups, and accordingly, the income (profit) generated is different. Then each product item is assigned only one index. The first letter of the index is the index assigned by profit; the second is an index assigned according to the number of sales facts.

4. Definition of groups A, IN And WITH.
To determine whether a selected object belongs to a group, you must:

• determine the value of the parameter (say, sales volume) for the selected units of the object of analysis (for example, for each assortment position of the selected assortment group);
• calculate the value of the parameter for the selected units as a cumulative total by adding the value of the parameter to the sum of previous estimates, that is, determine the share of the parameter in the total estimate;
• assign group names to selected objects.

• Group A- objects, the sum of shares with a cumulative total of which is the first 50% of total amount parameter values.
• Group IN- following the group A objects, the sum of shares with a cumulative total of which is from 50 to 80% of the total sum of parameter values.
• Group WITH- the remaining objects, the sum of shares with a cumulative total of which ranges from 80 to 100% of the total sum of parameter values.

Sometimes other percentages are specified, such as group A- 15% of reserves, B- 20%, C- 65%.

As a development of the idea of ​​the classical ABC- analysis in the work it is proposed to introduce a fourth group - illiquid assets, unclaimed products that do not generate income and freeze working capital enterprises.

Deeper mathematical approaches to identifying groups A, B, C discussed in the works.

Having grouped a product according to one parameter, compare the result obtained with estimates based on other parameters. Group WITH can generate 20% of revenue, account for 50% of inventory, and occupy 80% of warehouse space. For example, ABC-analysis of products by sales volume shows which products provide 80% of the company’s turnover. Analyze the same products, but by the number of units (or the number of orders for them) and as a result you will get 20% of the goods purchased by 80% of customers, and this is already attractive for the customer and the company’s turnover. When creating a methodology ABC-analysis used the principle of the outstanding economist Pareto, later named after him. While studying the economic life of Italy, Pareto in 1906 expressed the opinion that 80% of the welfare of Italian society is controlled by 20% social capital. Towards ABC-analysis, the Pareto principle may sound like this: reliable control of 20% of positions allows for 80% control of resources, be it stocks of raw materials and components, or the product range of the enterprise, or its clientele, or assortment positions trading enterprise, or warehouse stocks, etc.

The same result can be used when planning the placement of goods in a warehouse or on the sales floor of a store. Analyzing products by income will show you where you make money. A similar analysis of costs will allow you to understand where the money is spent.

At the same time, it is important to remember that ill-considered reduction of group products WITH(20% of the company's income) will lead to the fact that after some time the remaining goods are distributed according to the same law, but the overall result of your activities for the company may decrease by 50%.

Frequency ABC- analysis depends on a number of factors, and above all on the duration life cycle goods of a given trade group, seasonality of sales, influence of environmental factors. The frequency of the event is selected individually for each trading group. In particular, for trading enterprises in relatively stable environmental conditions ABC-analysis can be carried out once on the first working day of the new month following the analyzed period. ABC-analysis must be carried out over a period of 1 or 2 months, which will allow smoothing out to some extent fluctuations in seasonality, shortfalls, etc.

Data can be taken not for the last month, but for the last six months, taking into account in this way the influence of factors that go beyond one month. At the same time, with less frequent ABC- analysis, say, quarterly, you can miss some important factors and, for example, be left without a profitable product during the season.

to the group A needs to be given Special attention, constantly use control (monitoring) and planning procedures. Small changes in profitability, turnover, and prices for this group can lead to significant changes in financial indicators enterprises. As a result, daily monitoring of group products is possible A, especially when the technology for conducting such analysis has been established.

Regarding groups IN And WITH, then it makes no sense to analyze these positions every day assortmentally. However, to create the appearance of variety in the assortment, it is advisable to have several assortment items available for each group.

results ABC- analysis for certain categories of analysis, it is advisable to supplement it with the analysis “sales volume - contribution to covering costs (sales revenue minus all variable costs)”. This analysis can be carried out to assess the effectiveness of both individual market segments and trading enterprises purchasing goods from manufacturers.

2. Guidelines for conducting XYZ analysis
This analysis allows for the classification of goods based on a comparison of the stability of their sales volume. The purpose of the analysis is to predict the stability of certain objects of study, for example, the stability of sales of certain types of goods, fluctuations in the level of demand.

At the core XYZ-analysis involves determining the coefficients of variation (ν) for the analyzed parameters. The coefficient of variation is the ratio of the standard deviation to the arithmetic mean value of the measured parameters.

Where xi - parameter value for the assessed object for i- th period; - average value of the parameter for the analyzed object of analysis; n- number of periods.

Meaning square root is nothing more than the standard deviation of the variation series. The larger the standard deviation value, the further away the analyzed values ​​are from the arithmetic mean. If the standard deviation in the analysis of sales of one product is 15, and that of another product is 30, this means that monthly sales in the first case are closer to the monthly average and are more stable than in the second. If the standard deviation is 20, then with an arithmetic mean of 100 and 100,000 it will have a significantly different meaning. Therefore, when comparing variation series with each other, the coefficient of variation is used. Coefficients of variation of 20 and 0.2% make it clear that in the second case, the values ​​of the analyzed parameters differ significantly less from the arithmetic mean value.

XYZ-analysis is carried out in the following sequence.

1. Definition of the object of analysis: client, supplier, product group/subgroup, product item, etc.

2. Determination of the parameter by which the object will be analyzed: average inventory, rub.; sales volume, rub.; income, rub.; number of sales units, pcs.; number of orders, pcs., etc.

Most often, sales values ​​are used for analysis. Inventory is the result of many factors. The stock in the warehouse can significantly depend on the established frequency of deliveries, on the size of the minimum or maximum batch provided by the supplier, on the availability of warehouse space. In any case, the choice of parameter for analysis is best done experimentally, comparing the results obtained when using different parameters.

First two steps XYZ-analysis coincide with the same steps for ABC-analysis.

3. Determination of the period and number of periods for which the analysis will be carried out: week, decade, month, quarter/season, half-year, year.

The frequency of analysis for each enterprise is purely individual. Periodicity XYZ-analysis should be longer than the period from the moment the product is ordered until it is received by the customer. The greater the number of periods, the more indicative the results will be. If for the St. Petersburg chain of companies "Moidodyr" monthly sales were taken for analysis, then almost all products fell into the category Z. But when studying the figures for the quarter, everything fell into place, and X, And Y. As a result, the company abandoned monthly plans and switched to quarterly ones.

Another example. Analysis of sales of milk and bread in a retail store can be carried out based on the amount of sales per week. Deliveries are made every day, sales too. But if we compare the sales of milk and Absolut vodka (which is ordered once a month and sells 1 bottle every 2 weeks), then during this period 99% of the store’s assortment will fall into the category Z, 1% - in category Y. It turns out that we can conclude that work in extreme conditions in an unpredictable market. Therefore in in this case It is advisable to analyze monthly sales.

The analysis of sales and inventory in companies trading household appliances, building materials, spare parts for cars, etc. Financial plan in a company, it is often drawn up for a month, but the actually necessary planning horizon should be for six months. Analyzing data with a period shorter than a quarter simply does not make sense. All products fall into the category Z. Using XYZ- analysis, we must remember the reliability of the results obtained, which increases with the increase in the amount of information used. Based on this, the number of periods under study should be at least three.

Seasonality can greatly influence the results of calculations. Here's a typical case. The enterprise is informed about the increase in seasonal demand, the necessary stock of goods is purchased or produced. But due to sales surges, the product moves into the category Z. In this case, it is advisable to act as when launching a new product: compare the deviation of sales for the analyzed period from the forecast. In this case, the accuracy of planning is assessed.

To analyze data on products that have significant seasonal fluctuations, it is more correct and effective action there will be a separation of the seasonal component from the actual data. All the company’s products must be divided into groups that have similar seasonal sales dynamics. Then, for each group, you need to determine the seasonal trend and calculate the seasonal coefficients for each seasonal trend. These coefficients are determined by dividing the sales value of each month by the average sales value for the entire period (according to the seasonal trend). Then you need to divide the actual sales values ​​by the seasonal coefficient. As a result, we will obtain the sales volume of the product without taking into account seasonal fluctuations. The seasonal trend is the sales forecast value for a given month. If forecasting is not used, then you need to take the average of sales in this month over the previous three years. Now you can carry out XYZ-analysis based on the received data. From what is given in table. 2 examples show that after excluding the seasonal factor from sales of product 1, the coefficient of variation decreased to 12%.

4. Using the above formula, the coefficient of variation is determined for each object of analysis.

5. Grouping of objects of analysis in accordance with the increase in the coefficient of variation of parameters.

6. Definition of groups X, Y And Z. Tabular and/or graphical presentation of the results obtained (Fig. 1 and Table 3).

IN classic version XYZ- analysis when optimizing the range of goods for a category X include products characterized by a stable sales volume, minor fluctuations in their sales and high forecast accuracy. The coefficient of variation value ranges from 0 to 10%.

At the same time, it should be noted that empirically, taking into account the specifics of the scope of application of this method, objects and parameters of analysis, it is possible to establish other gradations of categories X, Y, Z. For example, for the category X the range of 0-15% can be selected, for the category Y- 16-50%, and for the category Z- 51-100%.

XYZ-analysis is of interest to distributors and manufacturers with their own warehouses. Any purchase is associated with large costs for the company (logistics, storage, etc.), as well as with direct risks, for example, the write-off of goods due to their expiration date. Maintaining accurate, balanced purchasing is a priority for both wholesale and retail enterprises.

Applying XYZ- analysis regarding your clients, you can build a sales forecast for future periods, develop special programs for regular loyal (not subject to various surges in orders) clients, as well as carry out measures to transfer clients from groups Y, Z to the group X.

Thus, the application XYZ-analysis allows you to divide the entire assortment into groups depending on the stability of sales. Based on the results obtained, it is advisable to carry out work to identify and eliminate the main reasons affecting the stability and accuracy of sales forecasting. At comprehensive analysis management of commodity resources the most productive combination of results ABC- And XYZ-analysis.

3. Combining the results of ABC and XYZ analysis
To combine the results obtained, we build a combined matrix. The simplest combination option is to sort both files with analysis results by the index field, then copy the column with groups from one file to another. Better of XYZ V ABC, since the actual value of the share of an object’s turnover has more practical meaning than the coefficient of variation.

As a result of this combination of two indicators - the degree of influence on the final result ( ABC) and stability/predictability of this result ( XYZ) - we get 9 groups of objects of analysis (Fig. 2).

In table Figure 4 provides characteristics of goods and individual items of the assortment policy for different cells of the combined matrix.

Products groups A And IN provide the main turnover of the company. Therefore, it is necessary that they are constantly available. It is a generally accepted practice when, for goods in a group A excess safety stock is created, and for group goods IN- sufficient. Usage XYZ- analysis allows you to develop a more accurate assortment policy and thereby reduce the total inventory.

Products group OH And VX distinguished by high turnover and stability. It is necessary to ensure constant availability of goods, but for this there is no need to create excess safety stock. The consumption of goods in this group is stable and well predicted.

Products group AY And BY with high turnover, they have insufficient sales stability, and, as a result, in order to ensure their constant availability, it is necessary to increase the safety stock.

Products group AZ And BZ with high turnover, they are characterized by low sales predictability. An attempt to ensure guaranteed availability for all goods in a given group only through excess safety inventory will lead to the fact that the company's average inventory will increase significantly. The ordering system for products in this group should be reviewed. Some goods need to be transferred to an ordering system with a constant order amount (volume), for some goods it is necessary to ensure more frequent deliveries, select suppliers located close to your warehouse (and thereby reduce the amount of safety inventory), increase the frequency of control, entrust work with this group of products to the most experienced manager of the company, etc.

Products group WITH make up up to 80% of the company's product range. Application XYZ-analysis allows you to greatly reduce the time that a manager spends on managing and monitoring the products of this group.

By product group CX You can use an ordering system with constant frequency and reduce safety inventory.

By product group C.Y. you can switch to a system with a constant amount (volume) of the order, but at the same time create a safety stock based on the capabilities available to the company.

To product group CZ all new goods, goods of spontaneous demand, supplied to order, etc. are included. Some of these goods can be painlessly removed from the assortment, and the other part needs to be regularly monitored, since it is from the goods of this group that illiquid or hard-to-sell inventories arise, from which the company incurs losses. It is necessary to remove from the assortment the remains of goods taken on order or no longer produced.

In table Figure 5 shows an example of combining results ABC- And XYZ-analysis.

The conjoint analysis matrix can also be used to rationalize the use of employee labor. Products category AX must be serviced by the most experienced and qualified employees, and the group of products falling into the category CZ, can be trusted to beginners. It will be easy for them to work with a category where orders occur less frequently, tolerances for deviations are higher, and only the amount spent on a given product item for a certain period is strictly limited. If you hire a new and inexperienced employee, then assign him to work with group products AZ, you risk incurring losses during the period when he gains the necessary experience. If you entrust him with the goods of the group CX, then, after working for a year, he will learn to press keys on a computer and send applications to the supplier. If you entrust him with the goods of the group CZ, then he will quickly gain experience, and the company will not suffer much from his experiments, and you do not need to control his every step.

So, using the combined ABC- And XYZ-analysis will allow:

• increase the efficiency of the commodity resource management system;
• increase the share of highly profitable goods without violating the principles of assortment policy;
• identify key products and reasons influencing the number of goods stored in the warehouse;
• redistribute staff efforts depending on their qualifications and experience.

TO merits The analysis methods considered include the following.

1. ABC-analysis allows you to simply and clearly study a large set of economic data. This method of analysis has received great development due to its versatility and efficiency. It can be used both in the activities of wholesale and retail trade enterprises, and in the activities of organizations that produce goods and services.
2. results ABC-analysis allow us to further rationalize assortment management activities. It is simpler and easier to control and maintain an assortment of 20 positions than 100. Especially when these 20 positions provide 80% of the profit. As a result, it is only necessary to conduct, say, daily assortment and quantitative control of the availability of goods belonging to the group A. At the same time, not only profitable products are identified, but also products that are in high demand, often cheap.
3. ABC-analysis allows you to make a fairly quick, but at the same time effective assessment state of affairs in the warehouse, allows you to rationally solve inventory management issues.
4. Regular comparison of new and old ABC-index allows you to see how many positions (up or down the classification) the product moved. The result of this classification is the ability to see which products are increasingly popular (are in the growth stage according to the stages of the product life cycle), and which are in the decline phase.
5. Application ABC-analysis helps solve the problems of segmenting consumers, studying demand, choosing effective marketing tools, and rational use of employee labor.

At the same time, the following can be noted flaws these methods.

1. Possibility of joining a group WITH new products. Difficulties arise in the case of a dynamically changing situation, for example, when introducing a new product to the market (the analogues of which the company has not yet traded) or a one-time acquisition of some product items. When the number of sales of a new product increases weekly, XYZ-analysis will not yield anything, the product will inevitably fall into the “unstable” group Z.
2. XYZ-analysis is meaningless and for enterprises working on order, they simply do not need such forecasts.
3. In market segments in which the spread of daily sales values ​​over the course of a month can be 50% or more, the use of XYZ-analysis may be useless, since all products will fall into the category Z.
4. How ABC- analysis and XYZ-analysis is focused on their use in relatively stable environmental conditions. Crisis phenomena, significant changes exchange rates, changes in the competitive situation, etc. sharply reduce the predictive value of the results obtained.

Especially it concerns XYZ- analysis, since even in a stable situation, making predictive conclusions based on data for 3-5 time periods must be done with great caution. It should also be recognized that the actual value of the share of turnover of an object has more practical meaning than the coefficient of variation.

Despite the noted shortcomings ABC- And XYZ-analysis are modern instrument marketing, the combined use of which with other methods of analysis helps to solve issues of assortment and pricing policy, selection of market segments and sales channels, inventory management, increasing the efficiency of using marketing communications tools.

Literature
1. ABC-analysis // http://www.abc-analysis.ru/
2. Afanasyev S.V. Triangle method in FBC analysis / S.V. Afanasyev //Marketing in Russia and abroad. - 2007. - No. 2.
3. Bodryakov Roman. Seminar on ABC and XYZ / Roman Bodryakov // http://www.rombcons.ru/ABC_XYZ.htm/
4. Bodryakov Roman. ABC- And XYZ-analysis: compilation and analysis of the final matrix / Roman Bodryakov // http://www.loglink.ru/massmedia/analytics/record/?id=275/
5. Two-factor ABC-analysis according to the method of P.V. Greek // Remedium.ru/
6. Dibb S. A practical guide to marketing planning / S. Dibb, L. Simkin, J. Bradley. - St. Petersburg: Peter, 2001.
7. Oblakov P.O. To the article “Triangle method in FBC analysis” / P.O. Oblakov // Marketing in Russia and abroad. - 2008. - No. 2.
8. Khamlova Olga. ABC-analysis: methodology / Olga Khamlova // Company management. - 2006. - No. 10.
9. http://www.sf-online.ru/
10. XYZ analysis (scenario) // http://www.4p.ru/index.php?page=17601#/

Also on this topic.

To analyze the product range, ABC analysis is a tool that allows you to study product range, determine the rating of goods according to the specified criteria and identify that part of the assortment that provides maximum effect.

The assortment is usually analyzed according to two parameters: sales volume (quantity sold) and profit received (realized trade margin).

ABC analysis - analysis of inventory by dividing into three categories:

A - the most valuable, 20% - inventory; 80% - sales

B - intermediate, 30% - inventory; 15% - sales

C - least valuable, 50% - inventory; 5% - sales

Taking this into account, the entire assortment of a trading enterprise can be divided into groups according to the degree of importance.

Group A - very important products that should always be present in the assortment. If sales volume was used as a parameter in the analysis, then this group includes top sellers by quantity. If trade margin was used as a parameter in the analysis, then this group includes the most profitable products.

Group B – goods of medium importance.

Group C - the least important products, these are candidates for exclusion from the assortment and new products. Depending on the purposes of the analysis, an arbitrary number of groups can be identified.

ABC analysis data helps optimize the product range. With all the many advantages of this type of analysis, there is one significant disadvantage: this method does not allow assessing seasonal fluctuations in demand for goods.

In logistics, ABC analysis is usually used to track shipment volumes of certain items and the frequency of requests for a particular product range, as well as to rank customers by the number or volume of orders they place.

Let's consider specific example performing ABC analysis:

The purpose of the analysis is to determine the highest priority product units.

The object of analysis is the sale of goods in natural units.

Initial data for the confectionery products group are in Table 2.

Table 2. Initial data for the group of confectionery products.

Let's divide objects into three groups:

Let's calculate the share of revenue for each product in the total revenue (column 4);

Let's calculate the parameter from column 4 on an accrual basis (column 5). We select groups 50%/30%/20% (column 6);

Let's assign group values ​​to the selected objects.

Table 4. Grouping of objects

Group A – goods, the sum of shares with a cumulative total of which is the first 50% of the total sum of parameters. These objects require careful planning, constant (perhaps even daily) and careful recording and control. These goods make up 50% of the turnover, and accordingly, the higher the cost of the goods, the more expensive errors in their analysis are. Periodic inventory counts with tight tolerances are required. A complete inventory of these groups should take place at least once a quarter. For group A, constant monitoring of demand, volumes of ordered batches and the size of safety stock is necessary. Careful monitoring and reduction of product turnover times is necessary.

Group B – products following group A, the sum of shares with a cumulative total of which ranges from 50% to 80% of the total sum of parameters. These objects are less important for the company and require regular control and well-established accounting (possibly monthly). They are subject to the same measures as for category A, but they are carried out less frequently and with larger acceptable tolerances.

Group C – other goods, the sum of shares with a cumulative total of which ranges from 80% to 100% of the total sum of parameters. These products are characterized by simplified planning, accounting and control methods. However, despite their apparent low value, they account for 20% of turnover (or profit) and require periodic monitoring.

Conclusion

To summarize, let us note the main features of the ABC analysis method.

ABC analysis is one of the methods of rationalization and can be applied in the field of activity of any enterprise and cover various management objects, such as product range, inventory, suppliers, customers, etc.

ABC analysis is based on the Pareto principle: “20% of effort produces 80% of the result, and the remaining 80% of effort produces only 20% of the result.”

The purpose of the ABC analysis method is to identify problems that need to be addressed first by prioritizing them. The ABC analysis method allows you to classify management objects according to the degree of their significance in the final result of the organization’s activities, and based on the results obtained, make appropriate management decisions.

The main advantages of ABC analysis are its ease of use, transparency, and versatility. Disadvantages include its one-dimensionality, distortion of results when using multidimensional ABC analysis, division of objects into groups without taking into account their qualitative characteristics.

The algorithm for performing ABC analysis is presented in detail in the second part of the work. One of the main stages that significantly influences the result of the analysis is the selection of groups, which can also be carried out using several methods: empirical, sum method, differential method, polygon method, tangent method, loop method. Of greatest interest to practical use represent the tangent method and the sum method, each of which has its own advantages.

All of the above methods distinguish three main groups: group A, group B and group C.

Group A– the most important resources, the locomotives of the campaign, bring maximum profit or sales. The campaign will suffer large losses if the effectiveness of this group of resources sharply decreases. Group A resources must be strictly controlled, clearly forecasted, frequently monitored, be as competitive as possible and not lose their strengths. Maximum investments and the best resources should be allocated to this group of resources. The successes of group A should be analyzed and transferred to other categories as much as possible.

Group B– a group of resources that provide good stable sales/profits for the campaign. These resources are also important for the campaign, but can be moderated at a calmer and more moderate pace. These resources are usually “cash cows” and are relatively stable in the short term. Investments in this type campaign resources are not significant and are necessary only to maintain the existing level.

Group C– the least important group in the campaign. This group may include: resources that need to be disposed of, that need to be changed, and improved. When analyzing this group, you need to be very careful and first of all understand the reason for their low contribution to the results of the organization's activities.

After all objects are divided into groups according to all selected factors, the results of the analysis are interpreted and, on the basis of this, actions are taken aimed at solving the problem posed at the first stage. The economic meaning of research within the framework of ABC analysis comes down to the fact that the maximum effect is achieved when solving problems belonging to group A.

List of used literature

1. Maslova, T.D. Marketing: textbook for universities / Etc. Maslova, S.G. Bozhuk, L.N. Kovalik. – 3rd ed., revised. and additional – St. Petersburg: Peter, 2008.

2. Berezin I.S. Marketing analysis. Market. Firm. Product. Promotion.
– 3rd ed., rev. and additional - M.: Vershina, 2008.

3. Alesinskaya T.V. Basics of logistics. Functional areas logistics management Taganrog: Publishing house TTI SFU, 2009.

4. Marketing: general course. Ed. Kolyuzhnova N.Ya., Yakobson A.Ya.
– M.: Omega-L, 2006.

5. Marketing by notes. Practical course on Russian examples. Ed. Danchenok L.A. – M.: Market DS Corporation, 2004 .

6. Electronic resource: “Financial Management Center” // http://center-yf.ru/data/Marketologu/ABC-analiz.php.

Analysis of ABC XYZ First of all, you need to know: what is it? To begin with, it is worth noting that these two analyzes are used in various business structures, for example, restaurants, shopping centers, alcohol companies and etc.

These two computational assistants help determine problem areas enterprises, plan actions, raise the price of goods that are in demand in a timely manner, and protect the company from future mistakes. So, ABC XYZ?

ABC analysis is the process of classifying goods and resources of an enterprise into groups according to their level of significance. This analysis uses the famous Pareto principle. This principle is based on the axiom: 20% of the total product produces 80% of the turnover. In particular, this rule can be applied to ABC analysis as follows: qualitative control of 20% of an enterprise’s resources brings 80% of the control of the entire system, in general, these can be products, equipment, raw materials, etc. What is this analysis method needed for and how is it applied? ?

Let’s say in a restaurant or fast food cafe, ABC analysis is most often used; it is needed to “sort everything out” and determine the share of the product in the turnover of the enterprise and calculate the percentage of the share of the product in the profit of the restaurant. A special table is displayed in which you must enter: the number of sales of the product per month (six months, year), the cost of the product and the selling price. Using a certain formula, it is necessary to order the products on a scale from min to max. Then, using this formula, determine the share of the product in the turnover and the percentage of the share of the product in the profit of the enterprise. After this, the table will give us the data of each product and the scale of their importance in terms of turnover and profit participation. The scale is called “Cumulative Total”, built from 1 to 100. If the assortment group on this scale falls in the range from 1 to 50, then it is group A, if in the range from 50-80, then the product is in group B, but in group C are products located in the range from 80 to 100. Products that are in group A and B have a large turnover and bring a good percentage of profit to the company, but those categories that are in group C should be worked on, to increase demand and turnover, or withdraw them from sale. According to statistics, categories that have been in group C for more than six months are eliminated.

XYZ analysis is a classification of inventory. Forecasts consumption, patterns of change and inventory requirements. A specific analysis algorithm is built, which includes calculating the coefficient of variation, grouping from min to max, distribution into XYZ groups, and displaying the result on a graph.

Most often this method is used in large enterprises where there are warehouses and a logistics center, which conducts XYZ research and evaluates the company’s logistics and clients.

What is included in the groupsX, Y, Z?

Group X includes the main stock items with a coefficient of variation of statistical sequences of shipments of 25%. These are resources that are consistent with a stable amount of consumption and require an accurate forecast of consumption.

In group Y there are the same product items with and have a statistical range of shipments of 25-50%. In this group of resources, it is necessary to determine the need for them; these could be seasonal products (beer, water).

Group Z carries the reserves of the statistical series with more than 50%. This group is characterized by irregular resource consumption and inaccurate forecasting. If you combine ABC XYZ analysis, it will show a more accurate table of consumption rates and shipment rates.

ABC XYZ analysis works best in pairs for a more accurate assessment of the enterprise's efficiency. This is the most powerful internal weapon of the company, by installing it at the core of the business, it can be revealed key points, save important enterprise resources and capture the lion's

We will analyze ABC analysis in detail theoretically and practically.

ABC sales analysis. Definition

ABC analysis (EnglishABC-analysis) is a method of increasing the efficiency and effectiveness of an enterprise's sales system. Most often, the ABC analysis method is used to optimize the product range (assortment) and its inventory in order to increase sales volume. In other words, the purpose of ABC analysis is to highlight the most promising products (or group of products) that bring maximum size profits for the company.

This type of analysis is based on the pattern identified by the economist Pareto: “20% of products provide 80% of the company’s profits.” The company's goal in conducting such an analysis is to identify key products and manage this 20% group, which will create control over 80% of cash receipts. Managing sales and cash payments directly affects the financial stability and solvency of the company.

When analyzing products, all products are divided into three groups:

• Group “A” – the most valuable goods, occupy 20% of the product range, and bring 80% of the profit from sales;
• Group “B” – low-value goods, occupy 30% of the product range, and provide 15% of sales;
• Group “C” – undemanded goods, occupy 50% of the assortment, and provide 5% of sales profits.

The products of the company of group “A” are targeted, and require maximum attention to their production and sales: their availability in warehouse stocks, prompt deliveries, planning and organization of production and quality control of these products.

ABC analysis of product sales. Stages of implementation

The stages of ABC analysis of the product range and sales volume of a company (enterprise) are as follows:

1. Determining the range of products of the enterprise.
2. Calculation of profit margins for each product group.
3. Determining the effectiveness of each group.
4. Ranking of goods and their classification (ABC) by value for the enterprise.

Example of ABC analysis of product sales in Excel

Let's look at how to conduct an ABC analysis of product sales in Excel for a cell phone store in practice. To do this, we need to have the names of all goods (groups of goods) and their rate of income. The figure below shows the product range and profit margin for each type.

Product range for ABC analysis in Excel

Next, you need to sort the goods by profitability. Go to the main menu Excel → “Data” → “Sorting”. The result will be a sorting of product groups by profitability from the most profitable to the most unprofitable.

On next stage it is necessary to determine the share for each type of product. To do this, we will use formulas in Excel.

Share of sales of each type of product=B5/SUM($B$5:$B$15)

Determining the share of products in the company's sales volume

At the next stage, the share of groups is calculated as a cumulative total using the formula:

Share of goods in the product range as a cumulative total=C6+D5

Estimation of the share of profit by cumulative total for a group of goods

After this, it is necessary to determine the limit to 80% for the group of goods “A”, 80-95% for the group of goods “B” and 95-100% for goods “C”. The figure below shows the result of grouping products into three groups for a cell phone store. Thus, the Samsung, Nokia, Fly and LG brands account for 80% of all sales, Alcatel, HTC, Lenovo account for 15% of sales, and Philips, Sony, Apple, ASUS account for 5% of sales revenue.

Having grouped goods, the company receives an analytical report on which goods provide the main cash flows. The further goal is to increase sales of target products from group “A” and reduce the share of ineffective products from group “C”. In our example, about ~30% of all goods bring the company 80% of the profit.

Benefits of ABC Analysis

1. Ease of use and speed conducting analysis to improve sales efficiency. The ABC analysis technique can be used in any enterprise, since it does not require large computing power and databases. All calculations for the product range can be made in a table in Excel.
2. Reliability of results. The results obtained are sustainable over time and allow the company to focus its resources and capital on the development of the most promising products. Managing the range of the most valuable goods allows you to create the financial stability of the enterprise.
3. Optimization of resources and time. Using the technique allows you to free up additional resources, both financial and time.
4. Universality of analysis. Possibility of applying the ABC analysis methodology to other areas of the enterprise.

Other areas of use of ABC analysis in a company

The range of use of this method of increasing efficiency in economic systems extremely wide:

• Optimization of product range.
• Identification of key suppliers, contractors, clients.
• Increasing the efficiency of organizing warehouse stocks.
• Optimization of the production process.
• Budgeting and management of marketing costs.

Disadvantages of ABC Analysis

In addition to the advantages of the technique, it also has disadvantages:

1. One-dimensionality of the method. ABC analysis is a fairly simple analytical method and does not allow grouping complex multidimensional objects.
2. Grouping of goods only based on quantitative indicators. The method is not based only on a quantitative assessment of the rate of income for each product range and does not evaluate the qualitative component of each product, for example, products of different categories.
3. Absence of a group of unprofitable goods. In addition to goods that bring profit to the company, there are also goods that bring losses. In this method, such goods are not reflected; as a result, in practice, ABC analysis is transformed into ABCD analysis, where group “D” includes unprofitable groups of goods.
4. Influence external factors for sale. Despite the fairly stable sales structure for this model, the estimate of future sales volume is strongly influenced by external economic factors: seasonality, uneven consumption and demand, purchasing power, influence of competitors, etc. The influence of these factors is not reflected in the ABC analysis model.

Summary

ABC sales analysis allows you to identify target product groups that provide 80% of the company's profit. This method increases the efficiency of the enterprise, analyzes and optimizes resources, which in turn affects financial stability and company profitability. The analyzed example shows the ease of using the ABC model to analyze the range of products and sales. The method can be widely used in other areas of the company to identify target groups: customers, suppliers, contractors, personnel, etc.

Return