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The ABC analysis groups inventory into three classes. Class A, B and C contain 80, 15 and 5 percent of the total value of the inventory respectively (Bowersox &amp. Cooper 1992). The ABC analysis gives a simple and quick review of the inventory. The ABC analysis also gives a clear view and meaning of the whole assortment of products in the inventory, thereby making it an efficient method to control inventory investment. The ABC analysis makes it easy for an inventory manager to devote resources to only those places where it will have the biggest positive feedback. Nike, Inc is an American manufacturer of shoes. In their ABC analysis, leather forms class A, sole forms class B while shoe lace forms class C (Cousins &amp. Spekman 2003). ABC analysis is a vital method for management of inventory.