What is ABC analysis?

Classifying items by value or criticality so attention goes where it pays.

ABC analysis splits inventory (or assets) into three classes: A items — few in number, most of the value or risk; B — the middle; C — many, cheap, low-risk. Controls, counts and buffers are set per class.

In the storeroom it drives count frequency and stocking policy; on the asset register it mirrors criticality — A-class assets get monitoring and deep PMs, C-class get the basics.

• How it's used