ABC classification of materials is most often done in terms of annual dollar volume.This identifies the most important SKUs as A-class.Increasing numbers of organizations try to prepare for shortage situations by overstocking the C-class of items.

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ABC classification typically prioritizes A-class items for overstocking to prepare for shortage situations, as these are the most critical or highest value items, not the C-class items which are of lower value or importance.

ABC Classification of Materials Is Most Often Done in Terms