What is Economic Order Quantity (EOQ) in Retail? Explained

Economic Order Quantity (EOQ) is a vital inventory management tool that calculates the optimal order quantity, striking a balance between minimizing inventory holding costs and ordering costs. By considering factors like ordering costs per order, product demand, and holding costs per unit, businesses can determine the most cost-efficient approach to managing their inventory. EOQ helps retailers make informed decisions on order quantities and frequencies, ensuring a streamlined and cost-effective inventory management process.