Join Eddie Davila for an in-depth discussion in this video Economic order quantity, part of Operations Management Fundamentals.
- So, how much inventory should we order?…That's one of the big questions Operations Managers face.…Is it better to have lots of inventory…so we're ready to meet any consumer desires,…or would we rather have cash in your pocket…and less money tied up in inventory?…Before we start to find the answers,…let's remember that the total cost of inventory…includes buying, holding, and ordering the inventory.…With so many costs, each with so many variables,…trying to find the best inventory order size…can be challenging and even confusing.…
With so many costs, each with so many variables,…trying to find the best inventory order size…can be challenging and even confusing.…Not to worry, though.…In Operations, we have a wonderful tool called the EOQ.…EOQ stands for Economic Order Quantity.…It's the order size that will provide you…with the lowest total inventory cost.…That's exactly what we're looking for, isn't it?…So, how do we find the EOQ?…Well, EOQ is the square root of 2DS over H,…where D is our annual demand,…S is the cost to place a single order,…
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- Understanding operations management
- Making key inventory decisions
- Balancing holding costs and ordering costs
- Choosing a production strategy and facility layout
- Managing waiting-line systems
- Defining quality and improving quality
- Managing business processes
Skill Level Appropriate for all
1. Introduction to Operations
2. Managing Inventory
3. Managing Production of Products and Services
4. Managing Waiting Lines
5. Managing Quality
6. Operations at the Office
Wrap up2m 52s
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