How to do FSN/FNS analysis

By doing FSN analysis materials can be classified based on their movement from inventory for a specified period.
Items are classified based on consumption and average stay in the inventory. Higher the stay of item in the inventory,
the slower would be the movement of the material
F Fast Moving
S- Slow Moving
N- Non moving
Sometimes the terms FNS is also being used, where
F Fast Moving
N- Normal Moving
S- Slow Moving
There following steps in doing the FSN analysis
Calculation of average stay and the consumption rate of the material in warehouse
FSN Classification of materials based on average stay in the inventory
FSN Classification of the material based on consumption rate
Finally classifying based on above FSN analysis.
Process
Lets take 10 materials for analysis. Following is the analysis of SKU01. Period of analysis is 15 days
Calculation of consumption rate and average stay of the material in the inventory

Opening Balance : 50

Average stay of the material = Cumulative No of Inventory Holding Days/( Total quantity
received + Opening Balance) =1161/115 =10.09 Days
Consumption Rate = Total Issue Qty/Total Period Duration =46/15 =3.06 Nos/Day
Now list down the materials with average stay and consumption rate

Now Carry out the FSN analysis on the basis of Average Stay only as below in MS
Excel as below by sorting down in descending order of Average stay.
Every company has its policy for defining FSN . Here FSN has been taken as F--10%,
S-20%, and N -70%

Now carry out the FSN classification only on the basis of consumption rate similarly as
above

Now carry out final classification by combining both as under