ABC classification

A method of categorising inventory by revenue contribution. A-class items (typically top 20% of SKUs) generate 80% of revenue and need tight stock control. B-class are middle-tier. C-class are long-tail items where stock-outs cost less. Originally from Pareto analysis applied to inventory in the 1950s. EOIT calculates ABC automatically from rolling sales data and lets you set different reorder rules per class.