Valuation Scope for Ranking Items
In the Define ABC Compile window you select a valuation scope for determining the ranking of items. If you choose to restrict your ABC compile to items within a particular subinventory, you have the option of valuing your items across all subinventories in the organization or just the one for which you have restricted the ABC compile. For example, item WIDGET1 has an on-hand quantity of 5 units in subinventory STORES1. The same item also exists in other subinventories in your organization, for a total on-hand quantity of 30 units in the entire organization. Item WIDGET2, has an on-hand quantity of 10 units in STORES1 and a total on-hand quantity of 20 units in the entire organization. You choose to compile your ABC analysis based on Current on-hand quantity.
If you restrict your ABC compile to subinventory STORES1, both WIDGET1 and WIDGET2 are included in the ABC analysis since they both exist in STORES1. However, the value to use is determined by what you choose in the Valuation Scope field on the Define ABC Compile window. If you choose to restrict valuation to the subinventory, Oracle Inventory uses 5 units for WIDGET1, 10 units for WIDGET2, and ranks WIDGET2 higher than WIDGET1. However, if you choose to value the same items across the organization, Oracle Inventory uses 30 units for WIDGET1, 20 units for WIDGET2, and ranks WIDGET1 higher than WIDGET2.
Defining and Running an ABC Compile