BASIC EOQ MODEL

D Annual Demand Quantity of the Product 1,000 Costs with EOQ

P Purchase Cost per Unit 1.00 Average Annual Purchase
C Fixed Cost per Order 20.00 Average Annual Fixed Orde
H Annual Holding Cost per Unit 0.25 Average Annual Holding Co
(warehouse space, refrig., ins., etc.) Total:

EOQ Economic Order Quantity 400.00 Try different order quantiti

(optimal order quantity)

50
Costs by Order Quantity Inven
40

30
Holding Cost
Ordering Cost
Total Cost 20

10

Since the demand will be satisfied with the unit purchase cost any way, it is discarded from the model. The cost in
2 types: Holding Cost and Ordering Cost. The tradoff between these costs is optimized at the minimum point of the
EOQ is the level of the inventory where ordering cost and carrying cost remains equal.
ODEL
0

Costs with EOQ

Average Annual Purchase Cost: 1,000.00
Average Annual Fixed Order Cost: 50.00
Average Annual Holding Cost: 50.00
Total: 1,100.00

Try different order quantities: 500.00

0
Inventory Level
0

om the model. The cost in consideration is reduced to

t the minimum point of the Total Cost Curve, i.e. EOQ.
 Follow the steps to enable your online EOQ Analyzer.
>> EOQ model uses the below assumptions:
1. The ordering cost is constant.
2. The rate of demand is constant
3. The lead time is fixed
4. The purchase price of the item is constant i.e no discount is available
5. The replenishment is made instantaneously, the whole batch is delivered at once.
The template allows you to compare EOQ with any other order quantity.
>> Your EOQ Analyzer is ready to use. Following steps are for online use.
1) Visit the site below:
http://www.spreadsheetweb.com/getting_started.htm
You will only need the username and password to create your online EOQ Analyzer.
2) Visit the site below:
https://www4.spreadsheetweb.com/SpreadsheetWEB//
Login to page with your new account information.
3) Click "Add Web Application" to upload this file. Your file will be created automatically.
You can simply use the file from that link or place it on your website.
>> Your online EOQ Analyzer will look like:
https://www4.spreadsheetweb.com/SpreadSheetWEB/Output.aspx?ApplicationId=0cd5db37-f477-47b4-891d-475c4060b3b2
>> In order to see more online applications created with PSW you can check the link below:
http://www.spreadsheetweb.com/demos.htm
4-891d-475c4060b3b2
 4 5
0 400.00 Holding COrdering Cost Total Cost
1 396.00 100 12.5 200 212.5
2 392.00 105 13.125 190.47619048 203.601190476
3 388.00 110 13.75 181.81818182 195.568181818
4 384.00 115 14.375 173.91304348 188.288043478
5 380.00 120 15 166.66666667 181.666666667
6 376.00 125 15.625 160 175.625
7 372.00 130 16.25 153.84615385 170.096153846
8 368.00 135 16.875 148.14814815 165.023148148
9 364.00 140 17.5 142.85714286 160.357142857
10 360.00 145 18.125 137.93103448 156.056034483
11 356.00 150 18.75 133.33333333 152.083333333
12 352.00 155 19.375 129.03225806 148.407258065
13 348.00 160 20 125 145
14 344.00 165 20.625 121.21212121 141.837121212
15 340.00 170 21.25 117.64705882 138.897058824
16 336.00 175 21.875 114.28571429 136.160714286
17 332.00 180 22.5 111.11111111 133.611111111
18 328.00 185 23.125 108.10810811 131.233108108
19 324.00 190 23.75 105.26315789 129.013157895
20 320.00 195 24.375 102.56410256 126.939102564
21 316.00 200 25 100 125
22 312.00 205 25.625 97.56097561 123.18597561
23 308.00 210 26.25 95.238095238 121.488095238
24 304.00 215 26.875 93.023255814 119.898255814
25 300.00 220 27.5 90.909090909 118.409090909
26 296.00 225 28.125 88.888888889 117.013888889
27 292.00 230 28.75 86.956521739 115.706521739
28 288.00 235 29.375 85.106382979 114.481382979
29 284.00 240 30 83.333333333 113.333333333
30 280.00 245 30.625 81.632653061 112.257653061
31 276.00 250 31.25 80 111.25
32 272.00 255 31.875 78.431372549 110.306372549
33 268.00 260 32.5 76.923076923 109.423076923
34 264.00 265 33.125 75.471698113 108.596698113
35 260.00 270 33.75 74.074074074 107.824074074
36 256.00 275 34.375 72.727272727 107.102272727
37 252.00 280 35 71.428571429 106.428571429
38 248.00 285 35.625 70.175438596 105.800438596
39 244.00 290 36.25 68.965517241 105.215517241
40 240.00 295 36.875 67.796610169 104.671610169
41 236.00 300 37.5 66.666666667 104.166666667
42 232.00 305 38.125 65.573770492 103.698770492
43 228.00 310 38.75 64.516129032 103.266129032
44 224.00 315 39.375 63.492063492 102.867063492
45 220.00 320 40 62.5 102.5
46 216.00 325 40.625 61.538461538 102.163461538
47 212.00 330 41.25 60.606060606 101.856060606
48 208.00 335 41.875 59.701492537 101.576492537
49 204.00 340 42.5 58.823529412 101.323529412
50 200.00 345 43.125 57.971014493 101.096014493
51 196.00 350 43.75 57.142857143 100.892857143
52 192.00 355 44.375 56.338028169 100.713028169
53 188.00 360 45 55.555555556 100.555555556
54 184.00 365 45.625 54.794520548 100.419520548
55 180.00 370 46.25 54.054054054 100.304054054
56 176.00 375 46.875 53.333333333 100.208333333
57 172.00 380 47.5 52.631578947 100.131578947
58 168.00 385 48.125 51.948051948 100.073051948
59 164.00 390 48.75 51.282051282 100.032051282
60 160.00 395 49.375 50.632911392 100.007911392
61 156.00 400 50 50 100
62 152.00 405 50.625 49.382716049 100.007716049
63 148.00 410 51.25 48.780487805 100.030487805
64 144.00 415 51.875 48.192771084 100.067771084
65 140.00 420 52.5 47.619047619 100.119047619
66 136.00 425 53.125 47.058823529 100.183823529
67 132.00 430 53.75 46.511627907 100.261627907
68 128.00 435 54.375 45.977011494 100.352011494
69 124.00 440 55 45.454545455 100.454545455
70 120.00 445 55.625 44.943820225 100.568820225
71 116.00 450 56.25 44.444444444 100.694444444
72 112.00 455 56.875 43.956043956 100.831043956
73 108.00 460 57.5 43.47826087 100.97826087
74 104.00 465 58.125 43.010752688 101.135752688
75 100.00 470 58.75 42.553191489 101.303191489
76 96.00 475 59.375 42.105263158 101.480263158
77 92.00 480 60 41.666666667 101.666666667
78 88.00 485 60.625 41.237113402 101.862113402
79 84.00 490 61.25 40.816326531 102.066326531
80 80.00 495 61.875 40.404040404 102.279040404
81 76.00 500 62.5 40 102.5
82 72.00 505 63.125 39.603960396 102.728960396
83 68.00 510 63.75 39.215686275 102.965686275
84 64.00 515 64.375 38.834951456 103.209951456
85 60.00 520 65 38.461538462 103.461538462
86 56.00 525 65.625 38.095238095 103.720238095
87 52.00 530 66.25 37.735849057 103.985849057
 88 48.00 535 66.875 37.38317757 104.25817757
89 44.00 540 67.5 37.037037037 104.537037037
90 40.00 545 68.125 36.697247706 104.822247706
91 36.00 550 68.75 36.363636364 105.113636364
92 32.00 555 69.375 36.036036036 105.411036036
93 28.00 560 70 35.714285714 105.714285714
94 24.00 565 70.625 35.398230088 106.023230088
95 20.00 570 71.25 35.087719298 106.337719298
96 16.00 575 71.875 34.782608696 106.657608696
97 12.00 580 72.5 34.482758621 106.982758621
98 8.00 585 73.125 34.188034188 107.313034188
99 4.00 590 73.75 33.898305085 107.648305085
100 0.00 595 74.375 33.613445378 107.988445378
0 400.00 600 75 33.333333333 108.333333333
1 396.00 605 75.625 33.05785124 108.68285124
2 392.00 610 76.25 32.786885246 109.036885246
3 388.00 615 76.875 32.520325203 109.395325203
4 384.00 620 77.5 32.258064516 109.758064516
5 380.00 625 78.125 32 110.125
6 376.00 630 78.75 31.746031746 110.496031746
7 372.00 635 79.375 31.496062992 110.871062992
8 368.00 640 80 31.25 111.25
9 364.00 645 80.625 31.007751938 111.632751938
10 360.00 650 81.25 30.769230769 112.019230769
11 356.00 655 81.875 30.534351145 112.409351145
12 352.00 660 82.5 30.303030303 112.803030303
13 348.00 665 83.125 30.07518797 113.20018797
14 344.00 670 83.75 29.850746269 113.600746269
15 340.00 675 84.375 29.62962963 114.00462963
16 336.00 680 85 29.411764706 114.411764706
17 332.00 685 85.625 29.197080292 114.822080292
18 328.00 690 86.25 28.985507246 115.235507246
19 324.00 695 86.875 28.776978417 115.651978417
20 320.00 700 87.5 28.571428571 116.071428571
21 316.00 705 88.125 28.368794326 116.493794326
22 312.00 710 88.75 28.169014085 116.919014085
23 308.00 715 89.375 27.972027972 117.347027972
24 304.00 720 90 27.777777778 117.777777778
25 300.00 725 90.625 27.586206897 118.211206897
26 296.00 730 91.25 27.397260274 118.647260274
27 292.00 735 91.875 27.210884354 119.085884354
28 288.00 740 92.5 27.027027027 119.527027027
29 284.00 745 93.125 26.845637584 119.970637584
30 280.00 750 93.75 26.666666667 120.416666667
31 276.00 755 94.375 26.490066225 120.865066225
32 272.00 760 95 26.315789474 121.315789474
33 268.00 765 95.625 26.14379085 121.76879085
34 264.00 770 96.25 25.974025974 122.224025974
35 260.00 775 96.875 25.806451613 122.681451613
36 256.00 780 97.5 25.641025641 123.141025641
37 252.00 785 98.125 25.477707006 123.602707006
38 248.00 790 98.75 25.316455696 124.066455696
39 244.00 795 99.375 25.157232704 124.532232704
40 240.00 800 100 25 125
41 236.00 805 100.625 24.844720497 125.469720497
42 232.00 810 101.25 24.691358025 125.941358025
43 228.00 815 101.875 24.539877301 126.414877301
44 224.00 820 102.5 24.390243902 126.890243902
45 220.00 825 103.125 24.242424242 127.367424242
46 216.00 830 103.75 24.096385542 127.846385542
47 212.00 835 104.375 23.952095808 128.327095808
48 208.00 840 105 23.80952381 128.80952381
49 204.00 845 105.625 23.668639053 129.293639053
50 200.00 850 106.25 23.529411765 129.779411765
51 196.00 855 106.875 23.391812865 130.266812865
52 192.00 860 107.5 23.255813953 130.755813953
53 188.00 865 108.125 23.121387283 131.246387283
54 184.00 870 108.75 22.988505747 131.738505747
55 180.00 875 109.375 22.857142857 132.232142857
56 176.00 880 110 22.727272727 132.727272727
57 172.00 885 110.625 22.598870056 133.223870056
58 168.00 890 111.25 22.471910112 133.721910112
59 164.00 895 111.875 22.346368715 134.221368715
60 160.00 900 112.5 22.222222222 134.722222222
61 156.00 905 113.125 22.099447514 135.224447514
62 152.00 910 113.75 21.978021978 135.728021978
63 148.00 915 114.375 21.857923497 136.232923497
64 144.00 920 115 21.739130435 136.739130435
65 140.00 925 115.625 21.621621622 137.246621622
66 136.00 930 116.25 21.505376344 137.755376344
67 132.00 935 116.875 21.390374332 138.265374332
68 128.00 940 117.5 21.276595745 138.776595745
69 124.00 945 118.125 21.164021164 139.289021164
70 120.00 950 118.75 21.052631579 139.802631579
71 116.00 955 119.375 20.942408377 140.317408377
72 112.00 960 120 20.833333333 140.833333333
73 108.00 965 120.625 20.725388601 141.350388601
74 104.00 970 121.25 20.618556701 141.868556701
75 100.00 975 121.875 20.512820513 142.387820513
76 96.00 980 122.5 20.408163265 142.908163265
 77 92.00 985 123.125 20.304568528 143.429568528
78 88.00 990 123.75 20.202020202 143.952020202
79 84.00 995 124.375 20.100502513 144.475502513
80 80.00 1000 125 20 145
81 76.00
82 72.00
83 68.00
84 64.00
85 60.00
86 56.00
87 52.00
88 48.00
89 44.00
90 40.00
91 36.00
92 32.00
93 28.00
94 24.00
95 20.00
96 16.00
97 12.00
98 8.00
99 4.00
100 0.00