ABC Analysis

What does the ABC analysis stand for?

ABC analysis is a method used for inventory categorisation. Also, it is used for prioritising problems, tasks, products or activities. In summary, ABC analysis involves placing inventory in categories according to benefit and use.

As a tool from Controlling, ABC analysis is particularly suitable for preparing decisions on business management issues. It can seen from three segments such as:

• A-certificates (very important)
• B-certificates (important), and
• C-certificates (less important)

The idea behind the ABC analysis is that even a small amount of resources can make a large contribution to success, if it is done in the right place.