Reorder point
Know when to reorder, with a buffer for uncertainty.
InventoryINVENTORY
Economic Order Quantity (EOQ) Calculator
Estimate the order quantity that balances annual ordering and inventory holding costs.
Economic order quantity calculator
Estimate the order quantity that balances annual ordering and inventory holding costs.
YOUR RESULT LIVE CALCULATION
Economic order quantity
775units / order
CLASSIC EOQ MODELOrdering and holding costs, in balance.
- Unrounded model optimum
- 774.596669 units / order
- Orders per year
- 31
- Days between orders
- 11.8 days
- Annual ordering cost
- $2,323.79
- Annual cycle-stock holding cost
- $2,323.79
- Combined annual cost
- $4,647.58
Excludes purchase cost and safety stock. Costs use the unrounded continuous optimum, not the rounded display. Apply viable whole-unit or pack constraints before ordering; a sub-unit optimum does not mean ordering zero.
BEHIND THE NUMBER
How the calculation works
The classic EOQ model assumes steady demand, constant unit costs, immediate replenishment, and no shortages. Its annual cost result includes ordering and cycle-stock holding cost only. Purchase cost, safety-stock carrying cost, quantity discounts, and minimum order quantities are excluded.
EOQ = √(2 × annual demand × ordering cost / annual holding cost per unit)
When this calculation helps
EOQ balances an entered cost per order with an entered annual holding cost per unit. It is useful for exploring that tradeoff when demand and replenishment are reasonably steady.
Check the interpretation
The lowest modeled annual cost does not override a case pack, supplier minimum, shelf-life limit, or cash constraint. EOQ excludes safety stock and quantity discounts unless explicitly modeled elsewhere. Compare feasible nearby quantities before adopting the rounded result.
Worked example: Reorder Point and Safety Stock: A Practical Example
Good to know
Is holding cost a percentage or a dollar amount?
Enter the annual dollar cost of holding one unit. For a $30 item at a 20% annual carrying rate, that is $6 per unit per year.
Does EOQ include safety stock?
The formula estimates the replenishment lot size. Safety stock is a separate buffer and is excluded from the cycle-stock cost shown here.