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Distinguish ABC and XYZ analysis

Updated: 12/20/2022
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ABC Analysis

ABC analysis classifies the raw materials based on their consumption during a particular time period ( usually one year). Depending upon the company to company A B & C items can be as under

A - Approx 5% to 10% of the Items accounting for 60% to 80% of the consumption value

B - Approx 10 % to 30% of the Items accounting for 10% to 30% of the consumption value

C -Approx 60% to 85% of the Items accounting for 5% to 15% of the consumption value

XYZ Analysis : XYZ analysis is more used in ralation of the customer demad for FG (finished goods) X is high demand, Y medium demand, Z very low or exporadic demand ABC/XYZ Analysis is usede to generate the strategic for the supply and inventory control and production strategy High runners are built to JIT Medium runners are produced to stock or to order and low runners are built to order BR

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