EOQ Inventory Model

The calculation sheet will assist you to determine optimized order quantities of your inventoried part, based on the EOQ Inventory Model.

To begin, you will need the following information:

Demand/Year (EAU): Annual projected demand for the part, or estimated annual usage (EAU)

Setup Cost: Costs for scheduling jobs irrespective of the quantity produced, For example, cost of labor required to load material or set up tools in between jobs.

Holding Cost/Unit: Cost to hold the inventory, can be calculated by calculating the warehouse cost divided by total storage locations, then multiplying that value into the number locations assigned to the part, then dividing that value into the number of parts stored in the location.

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