Assign ABC Codes

The cycle counting process (Warehouse Management) uses count types, including ABC codes, to determine which items to count and how often to count them. The Assign ABC Codes function is intended to assign an ABC code to all items (except kitted and service items) in the selected location(s) based on the ABC Codes setup, overriding existing ABC code assignments as necessary. To do so, it uses criteria to rank the items in the location(s) (On Hand Value, Usage Value, or Usage Frequency), then uses a combination of the sequence number and allocation % to assign ABC codes.

Because the Assign ABC Codes process can overwrite existing ABC code assignments, you may not want to run the Assign ABC Codes function more than once or once per year. However, for each ABC code you marked as 'Do Not Reset' on the IN ABC Codes maintenance screen, that code will not be overridden. Items assigned a 'Do Not Reset' ABC code will keep that code every time you run the Assign ABC Codes function.

For more information about assigning ABC codes, see the Assign ABC Codes Process topic.

When applying ABC codes to inventory items, the system will:

1. Ignore the ABC class for all items that have a Do Not Reset flag associated with the class (code). If the Do Not Reset check box is marked for an ABC code, then every item assigned to that ABC code will not be affected by the Assign ABC Codes function; the ABC codes for those items are not changed.
2. Assign ABC codes based on Global Settings (if the item matches more than one global setting, the system will assign the ABC class from the first global setting that matches item/location).
3. Assign ABC codes based on Consumption Value % (if calculating based on Usage Value or Usage Frequency)
4. Assign ABC codes to all remaining items based on sequence number and allocation %.

Notes:

• The Assign ABC Codes function does not assign codes to kitted or service items, nor does it consider kitted or service items when determining which code to assign to items.
• The Assign ABC Codes function uses current cost, not history cost, to calculate total value.
• When calculating value, the current cost is determined by the costing method selected in the IN costing method business rule. If the costing method is 'LIFO' or 'FIFO', the costing method from the IN zero costing method business rule is used.

Traverse determines the ABC code to assign to items/locations by calculations based on one of the following:

• On Hand Value: This value only looks at current on-hand value to rank items. This assumes that the more value you have in an item, the more important it is to count.
• Usage Value: Uses the value (cost * qty) of all items sold or consumed in production, service, etc. Transactions considered when analyzing consumption include: Material Requisitions, MP Build Component, AR Invoice, SO Verify, SO Invoice, IN Verify, IN Invoice Sale, BM Build Component, BM Unbuild Assembly, WM Material Requisitions.
• Usage Frequency: This option looks at the number of transactions (hits) for each item (quantity is not considered). Transactions considered when analyzing consumption include: Material Requisitions, MP Build Component, AR Invoice, SO Verify, SO Invoice, IN Verify, IN Invoice Sale, BM Build Component, BM Unbuild Assembly, WM Material Requisitions.

If you choose 'Usage Value' or 'Usage Frequency' as the base for calculations, you also have these options:

• Include Location/Bin/Container Moves: These additional functions are considered when including location/bin/container moves: Transfer From, WM Transfer From, Move Out.
• Consumption Value __ %: This value forces assignment of the least active code to items with a low consumption value. Items with a consumption value % below the % entered will be assigned to the least active ABC code. Leave at 0% to assign based purely on consumption activity.
• Fiscal Date From/Thru: The time frame to look at to determine consumption (usage).

You can assign ABC codes to each location using different criteria.

To assign ABC codes:

1. Select one or more locations for which you want to assign ABC codes to items using a particular criteria. Click All to select all locations or None to clear all check boxes.
2. If you want to calculate ABC code assignments by location rather than aggregating all locations together, mark the Run Locations Individually check box. If this check box is blank, the totals will be the totals by item across all locations, therefore each item will have the same ABC code in all locations. In contrast, by marking the check box, the item totals are considered by location, so the same item might have a different ABC code in a different location.
3. Mark the Include Obsolete Items check box if you want to include items with a status of 'Obsolete' in the Assign ABC Codes process.
4. Select the value to use to calculate ABC code assignments in the Calculate Based On drop-down list. This selection controls how the system determines what ABC code to assign to items. For more information about assigning ABC codes, see the Assign ABC Codes Process topic.
5. If you choose to calculate based on usage value or usage frequency, the Consumption Options are enabled:
   1. Select Include Location/Bin/Container Moves if you want the system to consider additional functions (Transfer From, WM Transfer From, Move Out) in its calculations.
   2. If applicable, enter a percentage in the Consumption Value % field. This value will force the system to assign the least-active ABC code (the code that is counted least often) to items with a low consumption value. For example, if you have a widget that costs $.02 but is consumed at a high rate, you can force the system to count it less often than the calculation might dictate.
   3. Enter a date range to use for consumption calculations as applicable in the From-Thru Fiscal Dates fields.
6. Enter any Comments.
7. To review the ABC code assignments, click Calculation View on the toolbar. This will open the ABC Calculation View interactive view. The view shows what the ABC code is before calculating and what it will be after the calculation and assignment is complete.
8. Click a command button to 

   Click	To
   OK	Begin processing.
   Activity	View the Activity Log for processing.
   Reset	Set all fields to their default values.

The Assign ABC Codes Log will appear when the process is complete.

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