Eoq formula: EOQ is a formula used

EOQ is a formula used to determine the optimal order quantity that minimizes inventory costs. It is important because it helps businesses reduce both ordering and holding costs while maintaining adequate stock levels. What is economic order quantity and how to calculate it? Learn about how to use the EOQ formula to lower your inventory order and holding costs. Economic Order Quantity (EOQ ) Objective: Determine the optimum level of ordering frequency and amount of units. The amount of units is called the Economic Order Quantity (EOQ ) or Economic Lot Size (ELS). Units may be pieces, items, each, widgets, etc. It is calculated specific to each product (unless all the variables happen to be the same for more than one product). The proper use of EOQ by product is essential for an effective JIT program. There is one basic commonly accepted formula but ...