Finally we could rank items on this basis and set up the frequency of count dependant on the ranking.
For example:
Category A (which could then be classed as the high value or high volume items) – Count frequently as this makes up a high percentage of annual inventory cost.
Categories B and C are then counted less frequently as they are a lower cost per item or used in smaller quantities, and therefore make up a lower percentage of the annual costs.
In order to produce a Pareto and ABC classification the following process should be followed which begins by using the annual item usage cost and unit costs.
| Item No. | Description | Annual Usage | Unit Cost | Annual Usage Cost |
| 1001 | Moulding A | 20,000 | £1.42 | £28,400.00 |
| 1002 | Moulding B | 10,000 | £0.51 | £5,100.00 |
| 1003 | Moulding C | 5,000 | £2.65 | £13,250.00 |
| 1004 | Pressing A | 20,000 | £0.32 | £6,400.00 |
| 1005 | Pressing B | 10,000 | £0.12 | £1,200.00 |
| 1006 | Pressing C | 5,000 | £0.22 | £1,100.00 |
| 1007 | Bolt A | 24,333 | £0.01 | £243.33 |
| 1008 | Bolt B | 23,007 | £0.01 | £230.07 |
| 1009 | Nut A | 24,096 | £0.01 | £240.96 |
| 1010 | Nut B | 22,455 | £0.01 | £224.55 |
Table 10: Annual Usage Cost (Item No order)