FSN & SOS, XYZ, GOLF Classification

FSN Analysis:-

FSN stands for fast moving slow moving and non-moving. Here, classification is based on the pattern of issues from stores and is useful in controlling obsolescence.

To carry out an FSN analysis, the date of receipt or the last date of issue, whichever is later, is taken to determine the number of months, which have lapsed since the last transaction. The items are usually grouped in periods of 12 months.

FSN analysis is helpful in identifying active items which need to be reviewed regularly and surplus items which have to be examined further. Non-moving items may be examined further and their disposal can be considered.

SOS Classification:-

Raw materials, especially agricultural inputs are generally classified by the seasonal, off-seasonal systems since the prices during the season would generally be lower.

The seasonal items which are available only for a limited period should be procured and stocked for meeting the needs of the full year. The prices of the seasonal items which are available throughout the year are generally less during the harvest season.

             The quantity required of such items should, therefore, be determined after comparing the cost savings on account of lower prices, if purchased during season, with the higher cost of carrying inventories if purchased throughout the year.

A Buying and stocking strategy for seasonal items depend on a large number of factors and more and more sophistication is taken place in this sphere and operational techniques are used to obtain optimum results.

XYZ Analysis:-

While the ABC analysis is based on the assumption on value, XYZ analysis is based on the value of inventory undertaken during the closing of annual accounts. X items are those having high value, Y items are those whose inventory values are medium and Z items are those whose inventory values are low.

The percentages are similar to ABC analysis. This analysis helps find items with heavy stock.

 

GOLF Classification:-

The letter stands for Government, Ordinary, Local and Foreign. There are mainly imported items which are canalized through the State Trading Corporation (STC) Minerals and Metals Trading Corporation, etc. Indian Drugs and Pharmaceutical Ltd (IDPL), Mica trading corporation etc. These are special procedures of inventory control which may not applicable to ordinary items as they require special procedures.

MNG Analysis:-

            The grouping of inventory items in this analysis takes place as:

• M- Moving items – The items which are consumed from time to time are normally referred to as moving items.

• N- Non moving items – These items which are not and consumed in last one year are covered under this group.

• G- Ghost items – This group refers to such items which neither have been received nor issued during the year. The balance of such items shown in stock registers of the organization will be nil, both at the beginning and at the end of the previous financial year.