Why Your Stocktake Belongs in Independent Hands
When a warehouse team counts its own stock, it is auditing its own work. Here is why auditors insist on an independent party — and what actually changes in the numbers.
Read ArticleFrom the Pareto principle to the warehouse floor
In most warehouses, a small proportion of items accounts for the largest share of movement and value. ABC analysis translates that observation into three practical categories, each handled differently.
How do you classify?
Class A: high-value or fast-moving items — few in number, large in impact.
Class B: moderate in value and movement.
Class C: low-value or slow-moving items — many in number, limited in impact.
Classification can be based on item value, on movement rate, or on a combination of the two. The choice is not a detail: value-based classification serves financial control, while movement-based classification serves operational efficiency.
Three decisions the classification changes immediately
1. Storage locations
Class A items go in the locations closest to the dispatch area and at easy-reach height (the golden zone). Class C items move to upper or rear zones. This change alone measurably reduces the daily walking distance of the picking team.
2. Counting frequency
There is no sense in counting every item at the same frequency. Class A is counted monthly, B quarterly, C annually. The result: higher accuracy for less effort.
3. Reorder levels
Class A items warrant close monitoring and carefully calculated safety stock. Class C items are managed with simpler levels, without burdening management with daily tracking of low-impact lines.
A common mistake
Classification is not a one-off exercise. Item movement shifts seasonally and year on year, and a Class A item this year may become a C next year. Review the classification at least twice a year.
United Integrated Team
