Optimal order quantity to minimize cost. The Economic Order Quantity (EOQ) Calculator takes annual demand (units), cost per order (admin, shipping), holding cost per unit per year and returns economic order quantity (units) plus orders per year, total ordering + holding cost per year, days between orders. Results update as you type, and the formula is shown under the result so you can repeat it in your own spreadsheet.
Online and retail margins are decided by the costs that are easy to forget: fees, shipping, returns, storage and advertising. Fill in every line, even with an estimate, before deciding what to sell and at what price. Use the worked example below to check the maths against your own figures.
How the Economic Order Quantity (EOQ) Calculator works
The order size that balances the cost of placing orders against the cost of holding stock. Ordering more often costs admin; ordering more at once costs storage and capital.
Worked example
With the example values (annual demand (units) of 12000, cost per order (admin, shipping) of $50, holding cost per unit per year of $2), the economic order quantity (units) is 775; orders per year 15.49, total ordering + holding cost per year $1,549.19, days between orders 24 days. Change any figure above and the result updates immediately; use Copy results to paste the summary into a note or email.
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Frequently Asked Questions
How is economic order quantity (units) calculated?
EOQ = √(2 × annual demand × order cost ÷ holding cost per unit).
Which figures do I need?
Annual demand (units), cost per order (admin, shipping), holding cost per unit per year. Take them from the same period and the same set of accounts or reports so the ratio is consistent, and check the example values as a guide to the units expected.
Which fees should I include?
Every fee your platform or provider charges on a sale: commissions, payment processing, fulfilment, storage, advertising and the expected cost of returns. Fee schedules change, so check the current rate card.
