In Article, Foresight, Practical Articles

Foresight: The International Journal of Applied Forecasting, Issue 20, Winter 2011, Pages 12 – 17

ABC classifications are commonly used to streamline a large number of SKUs into fewer, more manageable categories. As Aris, John, and Ruud explain, this classification may be useful for inventory control, but it does not provide much help in the selection of appropriate forecasting methods. The authors demonstrate a need for a classification that accounts for demand patterns and customer characteristics.