Economic order quantity, safety stock, reorder point, and MOQ constraint. Deterministic, 100% client-side.
Balancing holding costs against order frequencies is a continuous challenge for supply chain managers. An EOQ and MOQ order quantity calculator determines the mathematically optimal batch size to purchase for inventory replenishment. Factoring in demand velocity, ordering costs, safety stock, and supplier-imposed constraints, the tool identifies the most cost-effective purchasing strategy for physical goods.
EOQ is a formula that calculates the ideal order size to minimize the combined costs of inventory holding and purchasing logistics.
An EOQ might suggest ordering 200 units to minimize costs, but if the factory's Minimum Order Quantity (MOQ) is 500 units, the buyer must adjust their strategy, risking higher holding costs or negotiating new terms.
Holding costs, or carrying costs, include warehousing rent, insurance, depreciation, opportunity cost of capital, and shrinkage (damage or obsolescence) over a year.
The reorder point is calculated by multiplying the average daily demand by the lead time in days, then adding the required safety stock. This signals exactly when a new purchase order must be placed.