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I will put the answer in a simple way, avoiding the repetitive answers mentioned in the formal books
The EOQ is the quantity which ( best fits) your company's economical and business circumstances. Its the middle quantity that satisfies all aspect of your business, from the available cash in your pocket, to the minimal cost of inventory and operations required to keep the stock, but the same time satisfies the service level for the expected customers
This quantity keeps your business running in satisfying demand and avoid any stock outs, but at the same time avoid the risk of over compiling your cash in a solid form of raw materials or stocks
The EOQ is very important to solve the real life problems accuring at work when ordering quantities
EOQ stands for Economic Order Quantity. It is used by stores to define the optimal quantity of a specific product that needs to be stored in order to avoid unnecessary storage costs on one side or emergency shortages on the other side of that specific product.
Economic order quantity is really a simple concept. EOQ can be calculated by using a financial or accounting formula that arrives at the point at which the combination of ordering costs and carrying costs are the least.
Economic Order Quantity model is the inventory management technique for determining the optimum order quantity. The aim of the EOQ model is to minimise the total cost of holding and ordering inventory. To do this, it is necessary to balance the relevant costs which is the variable costs & fixed costs.
EOQ Stands for,Economic Order Quantity,minimize the total cost of inventory
EOQ is the Economic Order Quantity. This is the optimum quantity of goods to be purchased at one time in order to minimize the annual total costs of ordering and carrying or holding items in inventory.
Economic Order Quantity - minimize the total cost of inventory
Economic Order Quantity is the right ordering quantity where the ordering cost and carrying is minimum. It is calculated using below formula,
Q= SQRT((2*Annual Demend*Order Cost)/Carrying/Holding Cost)
EOQ stands for Economic Order Quantity. This is the optimal quantity of a stock item that should be ordered to ensure the cost of ordering and keeping the item in stock is minimised while ensuring there is no stock out.
EOQ stands for Economic Order Quantity which is the minimum order needed to maintain within Inventory so that there are no line stoppages and at the same time the holding cost of the Inventory is within the target.
ECONOMIC ORDER QUANTITY (EOQ) is the order quantity that minimizes the total holding costs and ordering costs. It is one of the oldest classical production scheduling models.
