Find the order size that minimizes ordering and holding costs.
Please do not make financial decisions based on these results.
What is the EOQ Calculator (Economic Order Quantity)?
Find the order size that minimizes ordering and holding costs. To use the EOQ Calculator (Economic Order Quantity), enter annual demand, cost per order, holding cost per unit per year; it returns economic order quantity, orders per year, total ordering and holding cost, and shows them instantly as you type.
Where the EOQ Calculator fits
Find the order size that minimizes ordering and holding costs. The main figure it returns is the Economic order quantity, worked out from the values you enter.
It belongs with the other accounting & microeconomics tools. If you are comparing options or checking a result from another angle, try the Economic Profit Calculator, Accounting Profit Calculator or the Profit Calculator.
How to use the EOQ Calculator (Economic Order Quantity)
- Enter your numbers. Start with Annual demand (units), Cost per order ($), Holding cost per unit per year ($). Use numbers from the same accounting period so the ratios are comparable. Fields marked optional can stay at zero.
- Read the result. The highlighted box gives the Economic order quantity, and the cards below show Orders per year, Total ordering and holding cost. Tables and charts break it down further.
- Test other scenarios. Results update as you type. Change one value at a time to see what drives the answer, and press Reset to go back to the defaults.
Formula and how it works
Example with real numbers
Here is the EOQ Calculator (Economic Order Quantity) using the default values shown in the calculator above:
Inputs
| Annual demand (units) | 12,000 |
|---|---|
| Cost per order ($) | 75 |
| Holding cost per unit per year ($) | 4 |
Results
| Economic order quantity | 671 |
|---|---|
| Orders per year | 17.9 |
| Total ordering and holding cost | $2,683.28 |
With these inputs the calculator returns Economic order quantity: 671. Change any value in the calculator to see how the result moves.
What if you change one input?
Sensitivity check: raising Annual demand (units) from 12,000 to 14,400 (about 20% higher) and leaving everything else as in the example above changes the results like this:
| Result | Example | After the change | Change |
|---|---|---|---|
| Economic order quantity | 671 | 735 | +9.5% |
| Orders per year | 17.9 | 19.6 | +9.5% |
| Total ordering and holding cost | $2,683.28 | $2,939.39 | +9.5% |
The input that moves the result most is the one to check twice. Change it in the calculator above to test your own case.
What the results tell you
The results panel of the EOQ Calculator (Economic Order Quantity) reports Economic order quantity, orders per year and total ordering and holding cost. Compare these figures while changing one input at a time, and use the related calculators below to look at the same situation from another angle.
Method and limits. This calculator applies the formula in the section above to your inputs, in your browser; nothing you enter is stored on our servers. The result is only as accurate as the numbers you enter and the formula shown above. It is for information, not financial, tax or legal advice.
Frequently asked questions
What costs does EOQ balance?
Ordering costs fall with larger orders while holding costs rise.
Why use average balances?
Ratios that compare a flow (sales, income) with a balance (assets, equity) are fairer when the balance is averaged over the period.
What is the cash conversion cycle?
It is DIO plus DSO minus DPO: the days between paying suppliers and collecting from customers.
Are the results guaranteed?
No. Results depend entirely on the numbers you enter and the formulas shown on this page. Please do not make financial decisions based on them alone; confirm important figures with a licensed professional.
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