What is ABC inventory, and how should a parts store use it?

Not every part on the shelf deserves the same attention. A filter that sells by the case every week is handled fifty times a quarter; a gasket that sells twice a year is handled twice. The filter is the one whose count will be wrong, and the one whose stock-out costs a ticket today.

What is ABC inventory?

ABC inventory is the method of sorting a catalog by how fast parts move and giving the fast ones more of everything: counts, reorder attention, and the shelf nearest the counter. A parts are the few hundred that carry most of the tickets, B parts fill in, and C parts are the long tail that is most of the catalog and a small share of the sales.

Should a parts store sort by velocity or by price?

A parts store should sort by how many times a part sold, not by its dollar value. The classic version of ABC ranks by value, and at a counter that gets it backwards: the expensive reman alternator that sells twice a month matters less day to day than the cheap filter that sells forty times. Sales count is how many times a part was handled, and handling is where the count drifts.

How do you decide which parts are A, B and C?

Run the last quarter’s sales and apply one rule per group:

• A: sold in most weeks of the last quarter.
• B: sold in most months of the last quarter.
• C: everything else.

A quarter, not a year, so a part that’s gone quiet drops down and a new line comes up. Most parts stores find a few hundred A parts, a thousand or so B parts, and a C list that is most of the catalog.

How often should each group be counted?

A parts are counted every few weeks, B parts once a quarter, and C parts once or twice a year. Spread across a daily cycle count of ten to twenty minutes, that covers the whole store without ever closing it.

Group	Sells	Counted	Min/max	Shelf
A	Most weeks	Every few weeks	Set and reviewed quarterly	Nearest the counter and the receiving door
B	Most months	Once a quarter	Set once	Middle of the room
C	A few times a year	Once or twice a year	Often zero; order when it sells	Far racks

Where should A parts sit on the shelf?

A parts belong nearest the counter and the receiving door, because every pick and every put-away walks to them. If an A part lives at the far end of rack L, every pick walks there. Moving a dozen fast movers to the front is an afternoon, and it pays back every day after. The store map’s fast-movers view shows which fast parts are in slow spots.

What does ABC change about reorder points?

ABC says which min/max numbers deserve attention: tune the A parts, leave the B parts, let the C parts float. A parts get real minimums that someone reviews each quarter, because being out of one costs a customer who buys the filter somewhere else today, and maybe the brake job with it. Most C parts can carry a minimum of zero and be ordered when they sell, so suggested orders stop proposing a case of something that moves twice a year. Once a year, look at the C parts that didn’t sell at all and decide whether they still deserve a bin.

The same sorting says what to clean up first when moving off QuickBooks POS: the duplicates and wrong on-hands that matter are on the A parts, because those are what the counter sells from.

How does AxleTap use velocity?

AxleTap keeps min, max and bin per item and per store, so a fast mover at one location and a slow one at another are treated differently.

• Suggested orders list what’s at or below min, grouped by vendor, and turn into draft purchase orders in one step. A C part with a minimum of zero never appears until it sells.
• The store layout is a map of the racks. Its fast-movers view shades each rack by how much moves through it and flags fast movers sitting in slow spots. The count-due view shows which racks are next.
• Cycle counts by rack, department or bin range, blind on the handheld, with differences posted as one adjustment. The detail is on the product page.