The essence of branding and abc analysis

Branding is the corporate style of the organization. The history of branding takes its roots in antiquity. There are allegations that brands have the same number of years as civilizations. Based on the research, evidence is provided that the history of branding can be traced back to 2250 BC. It is worth noting that the Russian history of branding is much shorter. This is justified by the fact that a significant number of well-known brands in Russia are very young. In every country in the world, branding is different, as a rule, because of differences in target audiences and mentality. It is clear that the implementation and creation of brand formation programs depend on the intentions of the heads of firms.

To increase the competitiveness of the organization, the scientific and methodological substantiation of branding is used. The essence of branding lies in the way products are differentiated, and also determines the tools for promoting goods to the market. We can say that this is the language of modern society, which is based on market relations.

Let's analyze abc analysis in an accessible and understandable language. This is one of the tools that determine the key products, categories, brands of a particular company. It is based on the Pareto rule, which states that 20% of the units bring the company an 80% profit. This principle can be applied not only to goods. Analysis in this way can customers, human resources, suppliers, the direction of activity.

In order to carry out abc analysis, in a particular organization, the object to be analyzed must be compulsorily accounted for, its movement reflected in the software. Otherwise, there will be nothing to analyze.

To begin with, you need to generate a sales report for a specific period of time for a certain category and transfer the received data, for example, to excell. In the report, at a minimum, there should be an article of the analyzed object, if the products are analyzed, and direct sales are reflected. For starters, it's easier to create a report in the Excel, because this program is flexible enough and the most common.

Then the data must be sorted as the sales decrease. Thanks to this, we will receive a total amount and will be able to allocate 80% and 15% of it.

Then you need to summarize the sales, starting with the maximum performance, recording the results in an additional column. As a result, it will reflect the cumulative totals. Where the amount will be equal to our 80% of the indicator it is necessary to put the border. Thus, the class A will be obtained.

Then we get class B, calculating by the same principle the following 15% of our profit. We have a class. All the remaining goods will be classified in class C.

The abc analysis includes three classes:

Class A contains goods that bring the greatest profit to the organization, if the profit is analyzed. Therefore, this category requires more attention.

Class B includes goods that also make a profit. In this case, a number of products in this class can be developed to class A.

Class C contains goods with the potential to remove from the assortment, as they unjustifiably freeze the organization's assets, occupy a significant part of the place in warehouses and shelves, and expend transport or human resources. It is worth noting a hundred doing abc analysis, do not make hasty conclusions until you see the overall picture.

With objects of analysis, you can and should experiment. Profit, turnover, gross turnover can supplement the analysis. Having completed several variants of such analysis, it is possible to obtain combined AB or CA classes, for example, turnover + profit. Even in this analysis, the essence of branding, embodied in the difference of private interests, which are united by the interests of one territory, is reflected.