EOQ Calculator

How to use this calculator

Select the measurement or holding-cost mode where available. Enter the required quantities using the labels and formula shown. Results update as you type. Copy result includes only the visible calculation summary; Reset clears all modes and values. Blank required fields need valid inputs before a result can be copied. The displayed examples are fixtures, not targets or recommended purchasing quantities.

Result · EOQ Calculator

Classical EOQ assumes steady demand, constant costs and replenishment without shortages. EOQ is how much to order; reorder point is when; safety stock is an uncertainty buffer; MOQ is a supplier constraint. Use the same currency for all monetary inputs.

Use EOQ as an explicit planning model

Economic Order Quantity, or EOQ, estimates how much to order in a replenishment batch under a classical inventory model. It balances the annual cost of placing orders against the annual cost of holding average cycle stock. The result is a theoretical quantity under stated assumptions, rather than an instruction to buy that quantity regardless of supplier rules, available cash or storage space.

Enter annual demand D and ordering cost per order S, then explicitly choose one holding-cost mode. In direct mode, enter annual holding cost per unit H. In rate mode, enter unit cost C and an annual holding-cost percentage; the calculator derives H = C × rate / 100. Only the selected mode is used. Results update locally in your browser. Copy result captures the selected inputs and outputs. Reset clears the figures. No account or email is needed, and entered numbers are not sent to a server.

Define the costs on a consistent annual basis

D is expected annual demand in units. Use usable demand history and a documented planning estimate rather than confusing it with current on-hand stock. S is the cost of placing and handling one order, such as relevant administrative effort or a fixed order-processing charge. It is not the product’s purchase price and is not an annual total spread across all orders.

H is the annual cost of holding one unit of inventory. The percentage mode is appropriate when your holding-cost estimate is defined as a rate applied to unit cost. A rate covering only financing may omit other relevant carrying components. If you already have a direct annual per-unit estimate, use that amount without multiplying it by unit cost again. All monetary inputs must use the same currency. Keep demand and holding cost on the same annual basis; a monthly rate cannot silently be treated as annual.

Worked example and secondary outputs

The classical formula is EOQ = √(2DS / H). With annual demand of 2,400 units, ordering cost of 18 per order and annual holding cost of 3 per unit, the result is √(2 × 2400 × 18 / 3), approximately 169.7056 units. The calculator shows the theoretical result and a separate approximate whole-unit quantity of 170. Calculations retain the unrounded quantity internally.

The alternative mode reaches the same result with C = 12 and an annual rate of 25%, because H = 12 × 0.25 = 3. Estimated orders per year is D / EOQ, about 14.14 in this example. Average cycle stock is EOQ / 2, about 84.85 units. Those supporting outputs use the theoretical quantity. They describe the model’s cycle, not a supplier calendar or a complete inventory target. Safety stock is excluded from average cycle stock.

Know when the classical assumptions are useful

The basic model assumes steady demand, constant ordering and holding costs, and replenishment without shortages. It uses average cycle stock and does not model seasonal peaks, uncertain lead times, expiry, changing purchase prices or quantity discounts. Its simplified relevant annual cost is DS / Q + HQ / 2. Purchase cost can be excluded from that comparison only when unit price remains constant across order quantities; it still belongs in your cash budget.

Positive finite inputs are required for a finite positive EOQ. Zero demand, zero ordering cost or zero holding cost creates a boundary case without the same usable interior optimum, so the calculator asks for valid positive values. Large numbers are handled without exposing undefined numeric outputs. Even a valid mathematical output needs a practical check against shelf life, storage, working capital and expected demand before the next review.

Separate quantity, timing and supplier constraints

EOQ addresses how much to order. Reorder point addresses when to place the order, based on demand during lead time and any safety stock policy. Safety stock is a buffer for uncertainty. MOQ is a supplier’s minimum order quantity. These concepts should remain distinct even when they are used together in one purchasing decision.

This calculator leaves MOQ and case-pack adjustments to the purchasing review. If a supplier’s minimum exceeds theoretical EOQ, compare the feasible minimum with cash, space and carrying costs. For case packs, compare feasible whole-case quantities around the theoretical result and apply supplier requirements explicitly. Nearest-case rounding is a practical convention, not proof of a global optimum. Use the linked reorder point calculator for the timing decision, and the carrying-cost and MOQ guides to check the assumptions before ordering.