Inventory Reorder Class

Each item's stocking record contains a field named Reorder Class which is also commonly referred to as "movement class". The values for this field range from 1 to 15 and Acclamare recalculates this value on the first Tuesday after the end of a month. Class represents segmented ranking based on the dollar cost of inventory associated to transaction movement of the stock item over the past 12 months. Class 1 includes those items that have the highest volume of cost dollars moving through inventory, while Class 12 items includes items that have the lowest volume of cost dollars moving through inventory. Class 13-15 are special classes which will be explained later.

Throughout a month, the costs of an item's posted transactions are accumulated into one of four "buckets" within Stock Item Usage. These buckets are Amount Sold (Invoices and credits), Amount Kitted (components consumed), Amount Transferred, and Amount Adjusted. The sum of these four values becomes the UsageAmountSold for a specific stock item for a specific month. At the conclusion of each month, the UsageAmountSold for the past 12 months of a stock item is totalled to arrive at the "annual amount sold" for each stock item.

Acclamare then evaluates each stock item for exception conditions.

  • If a stock item is not in "Active" status, it is set to Class 13.
  • If s stock item is less than 7 months old, it is set to Class 14.
  • If a stock item's annual amount sold is $0, it is set to Class 13.
  • If the stock item's annual amount sold is $0, and the Reorder Method is "Manual", it is set to Class 15.

Separately, for each warehouse/stocking location, all remaining stock items are put in descending order based upon their annual usage amount and assigned a rank based upon that order. The stock item that is first in that list is rank 1, the next is rank 2, and so on. Then that rank is divided by the number of items being ranked. The result of that division is the stock item's percentage rank. If the percentage rank is less than or equal to 7.5%, it is assigned Class 1. Each stock item is assigned into a Class based upon the Ran Percent found in the table below.

The table also displays additional information relative to classes. If your company is using Reorder Method of "Class", Acclamare's monthly recalculation of reorder controls sets a stock item's Order Quantity based of the values shown as "Class-Based Order Quantity". The goal is to achieve the "Projected Inventory Turns".

Rank Percent Class Class-Based Order Quantity Projected Inventory Turns
First 7.5%11 month's supply12.0 turns per year
Next 7.5%22 month's supply6.0 turns per year
Next 10%33 month's supply4.0 turns per year
Next 10%44 month's supply3.0 turns per year
Next 8%55 month's supply2.4 turns per year
Next 8%66 month's supply2.0 turns per year
Next 8%77 month's supply1.7 turns per year
Next 8%88 month's supply1.5 turns per year
Next 8%99 month's supply1.3 turns per year
Next 8%1010 month's supply1.2 turns per year
Next 8%1111 month's supply1.1 turns per year
Last 9%1212 month's supply1.0 turns per year

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