Our online calculator will help you to make the calculation of the optimal order batch.
In formulating the budget, material procurement, knowing the needs in their quantity to maintain continuous production process, can apply economic and mathematical models, allowing to optimize the volume and schedule of procurement materials.
One of the most common is the "Model of economically reasonable size of the order" (Economic ordering quantity EOQ-model) is better known as a model (formula) Wilson.
EOQ-model based on the minimization of total operating costs, which are divided into two groups:
cost allocation: the amount of expenses on delivery of goods, shipping charges and acceptance of goods;
cost determination for placement of orders for the supply of inventory is defined as the ratio of the volume of production consumption of raw materials for the period to the average volume of the same batch, multiplied by the average cost of placing one order;
costs for storing goods in the warehouse of the enterprise as the product of half the average volume of the same batch of raw materials and the average value storing unit floor stock;
the greater the volume of party of purchases of inventories, the less operating costs for the placement of orders in a certain period, and the more we buy, the less is the delivery of materials, the lower the amount of costs for the transportation, acceptance, etc.;
but along with this large amounts of one party purchases increase the cost of storing inventory as it increases the retention period.