> For the complete documentation index, see [llms.txt](https://learn.moselle.io/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://learn.moselle.io/operations/catalog/sku-grading.md).

# SKU Grading

Learn how SKU grading works in Moselle: what A, B, and C grades mean, how often they update, how to filter by grade, and how grades relate to forecasts.

{% hint style="info" %}
**Quick Answer:** SKU Grading assigns a performance tier — A, B, or C — to each product variant based on its units sold compared with the rest of your catalog. Grades refresh weekly. They help you prioritize replenishment and filter your plans, and Mo uses them as context when explaining forecasts. They are not a multiplier on your forecast numbers.
{% endhint %}

**SKU Grading is** a classification system that ranks each product variant by performance relative to the rest of your catalog. Every SKU receives a letter grade (A, B, or C) that reflects how it compares to your other items. This lets planners focus time and inventory resources on the products that matter most.

## What Are the Grade Tiers?

| Grade    | Meaning              | How to use it                                             |
| -------- | -------------------- | --------------------------------------------------------- |
| **A**    | Highest-selling SKUs | Top replenishment priority — avoid stockouts              |
| **B**    | Mid-tier SKUs        | Standard priority                                         |
| **C**    | Lowest-selling SKUs  | Lower priority — longer lead times are usually acceptable |
| **None** | Not yet graded       | Typically no sales history yet                            |

{% hint style="info" %}
Grades are based on **ABC Analysis** — an industry-standard framework rooted in the Pareto principle, where roughly 20% of SKUs typically drive 80% of revenue. A = top performers, B = middle tier, C = bottom tier.
{% endhint %}

## How Are SKU Grades Calculated?

|                      |                                                                          |
| -------------------- | ------------------------------------------------------------------------ |
| **What it measures** | Total **units sold** (not revenue)                                       |
| **Time period**      | Each SKU's full sales history in Moselle                                 |
| **Channels**         | All sales channels combined                                              |
| **Compared against** | The rest of your own catalog — grades are relative, not fixed thresholds |
| **Refresh cadence**  | Automatically, once a week                                               |
| **Unit of grading**  | Each SKU on its own                                                      |

Because grades reflect units sold over a SKU's whole history, a long-running SKU builds up a higher total than a recently launched one, even when both sell at a similar pace today.

## How Do SKU Grades Affect My Forecast?

**SKU grades do not directly raise or lower your forecast numbers.** Your directional forecast comes from each SKU's sales history — recent velocity, trend, and seasonality — and you then layer in business logic through forecast guidelines and edits.

Grades are context, not a forecast input:

* **Prioritization** — Filter plans by grade to focus on the SKUs that matter most.
* **Explanation** — When you ask Mo why a projection looks the way it does, Mo may cite a SKU's grade next to its sales velocity and year-over-year trend.
* **Your rules** — If you want grades to drive the forecast, add a rule to your **Forecast Guidelines** (e.g. *"Hold Grade C SKUs flat month over month"*), and Mo will apply it.

{% hint style="info" %}
**Seeing C-grade SKUs grow faster than B-grade SKUs?** That's driven by each SKU's own sales trend, not its grade. C-grade SKUs start from smaller volumes, so the same unit increase shows up as a bigger percentage lift.
{% endhint %}

## Where Do Grades Appear in Moselle?

**Production Plan and Supply Plans** Use the **Grade** filter to narrow the table to A, B, C, or ungraded SKUs. This helps planners focus on high-priority items without scrolling through the entire catalog.

**SKU details** Hover over a SKU to see its grade badge in the SKU details card.

**Mo AI Chat** Mo understands SKU grades. Ask things like *"Show me forecast vs. actuals for Grade A SKUs"* or *"Which Grade A items are at risk of stocking out?"*

## How to Filter by Grade in the Production Plan

**Time Required:** about 1 minute

1. Navigate to **Replenishment** in the left sidebar
2. Open your **Production Plan**
3. Click the **filter** controls at the top of the table
4. Select **Grade** and choose one or more tiers (A, B, C, or None)
5. The table updates to show only matching SKUs

The same **Grade** filter is available in Supply Plans.

## Key Definitions

**SKU (Stock Keeping Unit)** : A unique identifier for a specific product variant. "Red Hoodie, Size L" and "Red Hoodie, Size M" are two different SKUs.

**SKU Grading** : The process of assigning a performance tier (A, B, or C) to each SKU based on how it compares to the rest of your product catalog.

**ABC Analysis** : The industry framework behind SKU grading. Classifies inventory into three categories — A (top performers), B (middle), C (bottom) — to help planners prioritize resources.

**Grade Filter** : A filter control in the Production Plan that narrows the table to show only SKUs of a selected grade tier.

**Demand Projection** : A forecast of how many units of a SKU will be sold in a future period. Projections come from sales history and your business logic; grades are context, not a multiplier.

## Frequently Asked Questions

### How are grades assigned?

Grades are calculated automatically by Moselle from each SKU's total units sold, compared with the rest of your catalog. You do not need to assign grades manually.

### How often are grades updated?

Once a week. A SKU's grade can move up or down as its sales change relative to the rest of your catalog.

### Are grades based on units or revenue?

Units sold, across all of your sales channels combined.

### Why doesn't a replacement SKU have the same grade as the SKU it replaces?

Each SKU is graded on its own sales history, and grades don't carry over in a product transition. A new replacement SKU has less history, so it often starts with a lower grade and moves up as it sells. This **does not deflate its forecast** — the replacement's projection is driven by its sales history and your transition setup (see Item Comparables), not by its grade.

### Can I change a SKU's grade?

Grades are determined by Moselle based on catalog-wide performance data and are not manually editable.

### Why does a SKU show "None" for its grade?

A grade of **None** means the SKU has not been graded yet — usually because it has no sales history. It will receive a grade in the weekly refresh after it starts selling.

### Do grades change my forecast numbers?

No. Grades don't scale projections up or down. Mo can reference a SKU's grade when explaining a forecast, and you can write forecast guidelines that treat grades differently, but the grade on its own doesn't change the number.

## Related Guides

{% content-ref url="/pages/XujjS3140dWgq4aagxaz" %}
[Manage Your Production Plan](/planning-and-execution/replenishment/core-workflow/production-planning.md)
{% endcontent-ref %}

{% content-ref url="/pages/ja1XQcZPneh77RB6KNv3" %}
[Build Your Forecast with Mo](/planning-and-execution/forecasting/phase-2-build-your-forecast/build-your-forecast-with-mo.md)
{% endcontent-ref %}

{% content-ref url="/pages/a4VaHeybGOn75f976xpb" %}
[Setting Up Forecast Guidelines](/planning-and-execution/forecasting/phase-3-refine-and-maintain/setting-up-forecast-guidelines.md)
{% endcontent-ref %}

{% content-ref url="/pages/qHmiH0z8KHuvQI9BqrZh" %}
[Item Comparables](/planning-and-execution/forecasting/phase-3-refine-and-maintain/special-situations/item-comparables.md)
{% endcontent-ref %}

{% content-ref url="/pages/Y8NoLDfN1s6buHy6WJi4" %}
[View and Filter Your Catalog](/operations/catalog/access-your-catalog.md)
{% endcontent-ref %}