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# ABC Analysis Tutorial

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How does ABC Analysis divide the total inventory using the rupee volume? Explain.

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The ABC analysis is a supply chain technique that is used by inventory controllers or material managers. This analysis puts inventory into three categories and each category has a different management control associated with it (www.material-manage.com). The three classes are called A (most important), B (average importance) and C (least important). The ABC analysis is similar to the Pareto curve which is the 80/20 rule or it states that 80% of the rupee value consumption wise of an inventory remains in about 20% of the items. This rule is usually applied by ...

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This solution provides a detailed explanation of how ABC analysis divides the total inventory using the currency volume. Additionally, the solution provides one reference source for further research of ABC analysis.

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