ABC and XYZ analysis: a simple way to decide what to stock
Not every product deserves the same attention. ABC tells you what matters most; XYZ tells you how predictable it is. Together they tell you how to manage each item.
In this article
Most shops carry hundreds or thousands of products, but a small share of them drives most of the business. ABC and XYZ analysis help you see which items deserve your attention, and how to manage each one.
ABC: how much does it matter?
ABC ranks products by their contribution to sales value (or profit):
- A items: the few products that make up roughly the top 70–80% of value.
- B items: the middle group.
- C items: the long tail, many products, little value each.
The exact cut-offs are a choice; what matters is that A items never run out.
XYZ: how predictable is it?
XYZ ranks products by how steadily they sell:
- X: steady, easy to forecast (milk, rice, phone chargers).
- Y: some variation, seasonal or promotional.
- Z: erratic, hard to predict.
Put them together
| X (steady) | Y (variable) | Z (erratic) | |
|---|---|---|---|
| A | Automate reorders, keep lean safety stock | Reorder often, watch seasons | Order to demand, talk to customers |
| B | Automate reorders | Review monthly | Keep small stock |
| C | Order in bulk, rarely | Review quarterly | Consider dropping or ordering on request |
Use it for counting too
Count A items often (cycle counts every week or two), B items monthly and C items a few times a year. You catch the losses that matter without closing the shop for a full stock-take.
How ZaleBee helps
ZaleBee classifies products by ABC and XYZ for you, sets min / max levels and a preferred supplier per product, opens cycle counts by themselves and turns reorder suggestions into purchase orders per supplier.
ZaleBee Team
Product & customer success
We build ZaleBee and help shops, distributors and restaurants across India and the GCC set it up. These guides come from what we see every day.