Navigation: Tools >> Routines >> Inventory >> Value Code Update
The Value Code Update window is used to assign an “ABC” Code to Items based on their value. Traditionally, a small group of high value items are assigned “A”, a larger group of lower value items are assigned “B”, and a large number of low value items are assigned “C”. A items are counted more frequently than C items.
CompleteCount supports assigning more codes so inventory can be divided into small groups for more efficient cycle counting.
By default, the Value Code Update window will calculate typical ABC code assignments using the following logic:
A is assigned to the group of items which account for 70% of total inventory value
B is assigned to the group of items which comprise the next 20% of total inventory value
C is assigned to the group of items which comprise the last 10% of total inventory value
Typically, this results in a small group of high value items being assigned A. A larger group of “middle value” items will be B, and a very large group of “low value” items will be C.
To perform the Value Code Update:
- Make selections for the fields in Section A
- Click Calculate
- Adjust the value break points in Section C
- Review the proposed Value Code assignments in Section B
- If you are setting Value Codes at the Item-Site level, select an Update Site
- Click Update Value Codes button
Set: choose to set the Value Code at the Item, or Item-Site level. CompleteCount uses the Item-Site level Value Code when adding Items to a Stock Count. The Item-level Value Code provides a default that is used when the Item is assigned to Sites.
Using: select an option for how you want the determine the value of items. The options are:
- Usage Value Over Time Period: the dollar value of an item used over the specified time period. Usage Value is calculated by looking at the transactions that consume inventory (transaction quantity is negative) in Inventory Transaction Amounts History table (IV30300).
- Usage Quantity Over Time Period: the quantity of an item used over the specified time period. Like the Usage Value, this is calculated using the Extended Cost from transaction lines in the Inventory Transaction Amounts History table.
- On Hand Value: The Item’s current or standard cost multiplied by the Quantity On Hand for all Sites (if Site ID is left blank), or for the selected Site.
- Unit Cost: The Item’s current or standard cost.
Site ID: if left blank the calculation will be performed for All Sites.
From/To Dates: Enter a date range for the usage calculation.
Clear Value Code if Item has no Usage/Quantity: if you reassign Value Codes on a periodic basis, you may choose to clear the Value Code from items with no activity. Clearing the Value Code field can be used to exclude items from a Stock Count.
This window displays the value calculation and the proposed Value Code assignment. It displays the Items in order from highest to lowest value based on the calculation method used.
Update Site ID: if you are assigning Value Codes at the Item-Site level, select the Site in which you want to perform the update. Note that the Site used for the value calculation does NOT need to be the same as the Site where the update is performed.
The scrolling window in Section C is used to modify the proposed Value Code Assignment. This window shows the ACTUAL breaks based on the Percent of Total Value. For example, the default calculation attempts to assign A to those items which make up the top 70% of inventory value, but the break point might actually occur at 66%.
As shown above, due to the number of Items in the system and their usage value, the break between A and B occurs at 66%.
Change the break points, or add additional break points by changing the value in the % Ttl Value field. As you make changes, the window in Section B will redisplay to show the new proposed assignments.
After changing the value to 40% and tabbing out of the field, the window recalculates. Note that the value you enter may not remain if there is not a natural break point.
For example, as shown above, after entering 40% the window retained 40% because there is a break point at that value. However, if we enter 50%, the window will redisplay and show 40% because the only available natural break points are 40, 54 and 66%.
Add additional break points by entering additional values. The window will automatically recalculate so that the final row is always 100%.