ABC Analysis of a Given List of Medications

Divides Inventory into three classes based on Consumption Value.

Class A - High Consumption Value
Class B - Medium Consumption Value
Class C - Low Consumption Value.

ABC Classification Criteria.

Class Cost Cost Percentage Quantity (%) Order Frequency
A High 70-75 5-10 Frequent
B Medium 15-20 15-20 Once in Three Months
C Low 5-10 70-75 Once in Six Months

Steps in ABC Analysis:

1. List the Medicines Purchased/Consumed
2. For each item consumed or purchased, write down
The unit cost of each item
The quantity of each item consumed or purchased.
3. Calculate the Annual Consumption Value
Annual number of Units Sold (per item) x Cost Per Unit
4. List the Medicines in Descending Order Based on their Annual Consumption Value.
5. Total up the number of Units Sold.
6. Total up the Annual Consumption Value
7. Calculate the Percentage of Annual Units Sold.
8. Calculate the Percentage of Annual Consumption Values.
9. Calculate the Cumulative Percentage of Annual Units Sold
10. Calculate the Cumulative Percentage of Annual Consumption Values.
11. Classify the Medicines as per the ABC Classification Criteria.