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Economic Order Quantity Calculator

Find how much to order by balancing purchase-order costs with the cost of carrying cycle stock. Compare the theoretical EOQ with a quantity that fits whole packs and your supplier minimum.

Your numbers

USD · units

Balance order frequency with stock holding cost

Expected units sold or used over a full year.

Incremental ordering, delivery and receiving cost per purchase order, not the price of the stock.

Cost to hold one unit for a year. For a $20 item at a 15% annual carrying rate, enter $3.

Allowed order increment in whole units. Blank means individual units.

Supplier minimum in units. Blank means no minimum; the order still fits whole packs.

Compare your existing lot size with the constrained result. This baseline may not satisfy the new constraints.

Use one item and annual costs. Optional pack and minimum quantities constrain the comparison.

Your result

Order quantity

Enter annual demand and costs to find a practical quantity and compare its annual costs.

Calculated on your device. Your numbers aren’t sent or saved.

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The method

Find the cost balance, then check feasible packs

The economic order quantity minimizes annual ordering cost plus annual cycle-stock holding cost under steady demand and constant costs. The calculator evaluates allowed pack quantities around the theoretical optimum, subject to your minimum order. It compares both neighbors rather than always rounding upward. With no pack size entered, it compares whole units. An optional current quantity shows the difference under the same model.

Theoretical EOQ√(2 × annual unit demand × cost per order ÷ annual holding cost per unit)
Annual ordering costAnnual unit demand ÷ order quantity × cost per order
Annual cycle-stock holding costOrder quantity ÷ 2 × annual holding cost per unit
Allowed quantitiesPositive whole multiples of pack size, at or above minimum order quantity

Example 1

A lower whole pack can beat rounding upward

For 12,000 units a year, $50 per order and $3 annual holding cost per unit, theoretical EOQ is 632.46 units. With 100-unit packs, 600 units costs $1,000 to order and $900 to hold per year: $1,900 total. A 700-unit lot costs $1,907.14. The calculator chooses 600. A current 1,000-unit lot costs $2,100, so the modeled difference is $200 per year.

Theoretical EOQ
632.46 units
Selected pack quantity
600 units
Combined annual cost
$1,900.00
Difference from 1,000 units
$200.00

Example 2

A supplier minimum changes the feasible answer

With the same demand and costs, add an 850-unit minimum and 100-unit case packs. The smallest allowed quantity is 900 units. That costs $666.67 in annual ordering and $1,350 in cycle-stock holding, or $2,016.67 combined. The theoretical 632.46-unit optimum remains a reference; it is not feasible under these constraints.

Supplier minimum
850 units
Allowed quantity
900 units
Combined annual cost
$2,016.67

Before you calculate

Assumptions & limits

  • Demand is steady, replenishment is instantaneous when the order arrives, and the model allows no stockouts. Calendar cycle length assumes demand is spread over 365 days. It is an average, not a delivery schedule.
  • Order cost is incremental cost per order; annual holding cost is per unit per year. Use one currency throughout. Constant unit purchase expenditure is excluded because it does not change the optimum. Quantity discounts require a different comparison including purchase cost.
  • Average cycle stock is half the order quantity. Safety-stock carrying cost, cash availability, shelf life, storage capacity and demand variability are not optimized here. Check these separately before purchasing.
  • Demand, order cost and annual holding cost must be positive and no more than 1,000,000,000, with at most two decimals. Pack, minimum and current quantity accept whole units up to 1,000,000,000. A blank pack means one unit, a blank minimum means zero, and a blank current quantity means no comparison.
  • The selected quantity minimizes the stated mathematical cost among allowed pack sizes. Fractional annual order counts describe a long-run average; annual costs are estimates, not guaranteed savings. A current quantity may violate the entered new supplier constraints and still serve as a clearly labeled comparison.

Keep in mind

Common mix-ups

Entering monthly holding cost as annual

The denominator must be holding cost per unit for a full year. Mixing monthly cost with annual demand overstates the order quantity.

Always rounding EOQ upward

Compare the cost of both feasible neighboring pack quantities. A lower pack can have the better balance, as the 600-versus-700 worked example shows.

Confusing how much with when

EOQ is a lot-size model. Use the Reorder Point Calculator for the trigger to place an order, and size a separate safety buffer when demand or supplier lead time varies.

Sources & calculation notes

ACCA — Stock control

Derives annual ordering and holding costs, explains EOQ assumptions and consistent units, and distinguishes quantity-discount analysis. Pack and minimum-order comparison is our explicit extension of this cost model.

Calculation and input rules checked: . Engineering validation; no professional accounting review is claimed.

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