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ABC Product Analysis
Determine the value of inventory items based on their importance to your business.
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The Challenge
Companies must have robust inventory management systems to track and monitor every movement of their items throughout the logistics process. Crucial data such as product descriptions and the stock numbers for each product type must be readily available and up-to-date.
Certain products generate more revenue than others. It comes down to customer demand, production costs, and risk calculations. Businesses must identify which of their products or services can impact their total sales, so they can make improvements and plan for growth.
ABC product analysis helps companies manage their inventory and highlight essential products. However, proper research requires extensive data collection: inventory data, product value, percentage value, and the total value of the inventory.
How can companies arrive at an accurate product analysis?
The Solution
ABC product analysis helps companies categorize their inventory, and Graphite’s no-code machine learning makes it easy for production teams to identify which products should be given the most attention.
This will help finance and sales teams know where to allocate the most resources and marketing focus. It gives them better control over expenses, reduces inventory obsolescence rate, and boosts inventory turnover rate.
The AI uses inventory data and Pareto’s Law to find the value of each item in the inventory. Sales, profit, and demand can be used to measure product value.
Graphite will determine the value and impact of each product to help business owners make data-driven decisions regarding inventory and production.
The Impact
Product analysis helps companies focus their attention on products that will power growth and have the most impact on revenue. With this data, businesses can spend capital on products that generate high profits, leading to success and future scaling.
AI-generated systems also make managing less significant products in the company’s arsenal easier. With robust ABC product analysis, businesses can effortlessly track product movement and manage production and inventory costs.
Further Reading
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