What is EOQ (Economic Order Quantity) | EOQ formula | inventory management

Welcome to Commerce Shruti! In this video, we will explore the concept of Economic Order Quantity (EOQ), a vital tool in inventory management used to determine the optimal order quantity that minimizes total inventory costs.

Economic Order Quantity (EOQ) is the order quantity that minimizes the total cost of inventory, including ordering costs (cost of placing and processing orders) and holding costs (cost of storing inventory). By using the EOQ formula, businesses can ensure efficient inventory management and avoid overstocking or stockouts.

Key Highlights of the Video:
What is EOQ?
Understanding its importance in managing inventory effectively.

Inventory Costs:
Explanation of ordering costs, holding costs, and how EOQ balances these.
Practical Application:
Solving an example to calculate EOQ for better clarity.
By the end of this video, you will gain a clear understanding of how EOQ helps businesses optimize inventory levels, control costs, and improve operational efficiency. Perfect for Class 12 students and aspiring management professionals!

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