What you’ll learn
ABC classification ranks your items by how much of your total picking cost they generate. Use it to find the small group of items that drives most of your spend, so you can concentrate purchasing, stocking, and counting effort where it pays off.
ABC classes at a glance
| Class A | Class B | Class C | |
|---|---|---|---|
| Default share of picking cost | 70% | 20% | 10% |
| Typical number of items | Few | Some | Many |
| What it tells you | These items dominate your consumption cost | These items matter, but less | These items have little effect on total cost |
| How to treat them | Review order quantities and prices closely, keep stock levels tight, count often | Review periodically | Keep buffers generous, review rarely |
The three percentages are shares of your total picking cost over a chosen period – not shares of your item count. A cheap insert that is picked every day can easily be class A, while an expensive tool picked twice a year lands in class C.
How CRIBWISE calculates the classes
The calculation runs on historical picking data for the period you select – the last 30, 60, or 90 days. CRIBWISE does four things:
- Adds up the cost of every pick per item over the period.
- Sorts the items by that cost, highest first.
- Works down the list, adding up a running share of the total cost (the % cumulative column).
- Compares that running share with the thresholds set in system settings. Items up to the A threshold become A, items up to A plus B become B, and everything left over becomes C.
With the default 70 / 20 / 10 thresholds, every item up to 70% cumulative is proposed as A, every item up to 90% cumulative as B, and the rest as C.
Example. Six items, EUR 15,000 of picking cost over 90 days:
| Item | Cost of picks | % of total cost | % cumulative | Proposed class |
|---|---|---|---|---|
| Turning insert | 7,000 | 46.7% | 46.7% | A |
| Milling insert | 3,000 | 20.0% | 66.7% | A |
| Solid carbide drill | 2,000 | 13.3% | 80.0% | B |
| Thread tap | 1,500 | 10.0% | 90.0% | B |
| Reamer | 900 | 6.0% | 96.0% | C |
| Collet | 600 | 4.0% | 100.0% | C |
Two items out of six carry two thirds of the cost. Those are the ones worth negotiating and monitoring.
Tip: Cost of picks is built from the usage cost of the items picked. If the figures look wrong, check how usage cost is derived first – see Understanding item costs: standard cost and usage cost.
What the report shows
The report lives under Reports > ABC classification. Choose a period in Classify by last … days and select Classify to run it.
(1) ABC classification under Reports, (2) the period selector – 30, 60, or 90 days – and (3) the Classify button. The grid appears only after the calculation has run.
When the calculation finishes, every item you are allowed to see appears in a grid, ordered by cost of picks, highest first.
The result grid: (1) the cost columns the classification is based on, (2) the class each item has today, (3) the class the system proposes, and (4) the two buttons that apply the proposal. This demo site holds only three items and recorded no picking cost in the period, so the cost columns read zero – on a live site the rows are sorted by cost of picks, highest first.
| Column | What it shows |
|---|---|
| Item | Item ID and description. |
| Cost of picks | Total cost of everything picked of this item in the selected period. The grid is sorted by this value, descending. |
| % of total cost | This item’s cost of picks divided by the cost of picks of all items in the period. |
| % cumulative | The running total of % of total cost for this item and every item above it. This is the value compared with the thresholds. |
| Actual classification | The own classification currently stored on the item. |
| Proposed classification | The class the calculation suggests. Nothing is stored until you apply it. |
Three toolbar buttons act on the result:
- Update all – applies the proposed classification to every item in the list.
- Update selected – applies it only to the rows you tick.
- Refresh – reloads the grid.
After an update the report reloads, and Actual classification now matches Proposed classification for the items you applied.
Important: Running the classification changes nothing on its own. It only proposes. Your items keep their existing class until you select Update all or Update selected.
Warning: If your access is limited by a product access group or a vendor restriction, the items you cannot see are hidden from the grid – but they are still counted in the totals. The % cumulative column can therefore look wrong to you. See How to restrict item access with Product Access Groups (PAG).
Where the thresholds are set
The A, B, and C thresholds are global. Find them under Administration > System settings > Purchase, in Own classification (A, B, C). The three fields hold the A, B, and C shares in that order, and ship as 70, 20, and 10.
(1) the Purchase tab of System settings, and (2) the Own classification (A, B, C) thresholds – 70, 20, and 10 by default. Change them to match how your organisation splits its spend, then select Save.
Raising the A threshold puts more items into class A and makes the top group broader. Lowering it narrows class A to the few heaviest cost drivers. The full field list is in the System settings reference.
Where the class ends up
An applied class is written to the item’s Own classification field, on the General information tab of the item detail. You can also set that field by hand at any time – the report simply fills it in for you in bulk.
The Own classification field in the Classification section of the item detail. This is the same value the report shows as Actual classification.
Once stored, the class travels with the item. It is available as a column, a grouping, and a filter on reports built from raw transactions data, so you can break consumption down by class – see Report data sources reference.
Note: A classification is a snapshot of the period you chose. Consumption patterns drift, so rerun the report on a regular rhythm – quarterly is a common choice – rather than treating one run as permanent.
Common confusion
| People often think… | But actually… |
|---|---|
| Class A means the most expensive item. | Class A means the item generates the largest share of picking cost over the period. A cheap item picked constantly beats an expensive item picked once. |
| Running the report reclassifies my items. | The report only proposes. Nothing is written until you select Update all or Update selected. |
| Items I cannot see are left out of the calculation. | Items hidden by a PAG or a vendor restriction are excluded from your view, not from the totals. |
| The thresholds are percentages of my item count. | They are percentages of total picking cost. The number of items in each class falls out of the data. |
| An item with no picks in the period is ignored. | It is classified too. With no cost it lands at the bottom of the list, which normally means class C. |
Take action
Ready to classify your items? Run it from the Admin Portal in four steps:
- Confirm the thresholds under Administration > System settings > Purchase.
- Go to Reports > ABC classification.
- Pick a period in Classify by last … days and select Classify.
- Review the Proposed classification column, then select Update all – or tick individual rows and select Update selected.
Done when: the grid reloads and Actual classification matches Proposed classification for every item you applied.
Related articles
- Reporting overview: charts, tables, dashboards, and BI – how ABC classification fits with the rest of the reporting module.
- Understanding item costs: standard cost and usage cost – where the cost behind Cost of picks comes from.
- System settings reference – every system setting, including the ABC thresholds.
- Item fields and settings reference – the Own classification field and the rest of the item detail.
- Report data sources reference – the data sources that expose own classification as a report field.
- How to restrict item access with Product Access Groups (PAG) – why some items are hidden from your grid.