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The ABC methodology, not to get confused with the Activity Based Costing, is used to measure the concentration of a phenomenon (revenues, stocks, etc.). For example, the ABC Analysis carried on the sales value shows how the revenue is divided among different products that can now be managed accordingly to their importance.
Class A includes the goods whose value counts most on the stocks’ total one and that require a constant monitoring; Class B includes the goods that require a periodic monitoring; Class C includes the goods that can be easily managed by implementing simpler procedures.