{"id":2237,"date":"2006-12-26T20:18:00","date_gmt":"2006-12-26T20:18:00","guid":{"rendered":"https:\/\/www.certitrek.com\/nlpa\/2006\/12\/26\/purchasing-and-inventory-management\/"},"modified":"2021-07-29T04:27:20","modified_gmt":"2021-07-29T08:27:20","slug":"purchasing-and-inventory-management","status":"publish","type":"post","link":"https:\/\/www.certitrek.com\/nlpa\/blog\/purchasing-and-inventory-management\/","title":{"rendered":"Purchasing and Inventory Management"},"content":{"rendered":"<p>I hope that you have enjoyed the article \u201c<a href=\"https:\/\/www.certitrek.com\/nlpa\/news\/purchasing-articles\/purchasing-and-inventory-management\/\">Purchasing &amp; Inventory Management Hook Up!<\/a>\u201d As promised in that article, here\u2019s the EOQ formula:<br \/>\n<a href=\"https:\/\/www.certitrek.com\/nlpa\/images\/eoq.jpg\"><img decoding=\"async\" class=\"lazyload alignnone\" style=\"margin: 0px auto 10px;text-align: center\" src=\"https:\/\/www.certitrek.com\/nlpa\/wp-content\/uploads\/sites\/5\/2021\/04\/eoq.jpg\" alt=\"This image shows the equation for figuring out EOQ, or Economic Order Quantity\" width=\"319\" height=\"136\" border=\"0\" \/><\/a><\/p>\n<p>Where:<\/p>\n<p>EOQ = Economic Order Quantity<\/p>\n<p>ACPO = Acquisition Costs Per Order<\/p>\n<p>AUU = Annual Usage in Units<\/p>\n<p>UC = Unit Cost<\/p>\n<p>CCP = Carrying Cost Percentage<\/p>\n<p>So, if you know that it costs you $150 in overhead per order, you use 5,000 widgets a year, you pay $200 per widget, and your Finance Department tells you that annual carrying costs are equal to 20% of the value of the goods in stock, you should order\u2026<\/p>\n<p>Drumroll, please.<\/p>\n<p>194 widgets at a time.<\/p>\n<p><a href=\"https:\/\/www.certitrek.com\/nlpa\/individuals\/membership\/\">Become a member of one of the world\u2019s largest procurement associations today.<\/a><\/p>\n<p><strong>\u00a0<\/strong><\/p>\n<p><strong>Recommended Reading<\/strong><\/p>\n<ul>\n<li><a href=\"https:\/\/www.certitrek.com\/nlpa\/news\/purchasing-articles\/impact-of-inventory\/\">Impact of Inventory<\/a><\/li>\n<li><a href=\"https:\/\/www.certitrek.com\/nlpa\/news\/purchasing-articles\/inventory-puchasing\/\">Inventory Purchasing<\/a><\/li>\n<li><a href=\"https:\/\/www.certitrek.com\/nlpa\/blog\/courses\/profitable-inventory-management-and-control\/\">Profitable Inventory Management and Control<\/a><\/li>\n<li><a href=\"https:\/\/www.certitrek.com\/nlpa\/news\/purchasing-articles\/inventory-turnover-ratio\/\">Inventory Turnover Ratio<\/a><\/li>\n<li><a href=\"https:\/\/www.certitrek.com\/nlpa\/news\/purchasing-articles\/purchasing-and-inventory-management\/\">Purchasing and Inventory Management<\/a><\/li>\n<li><a href=\"https:\/\/www.certitrek.com\/nlpa\/blog\/myth-learning-inventory-management-is\/\">Myth: Learning Inventory Management Is Painful<\/a><\/li>\n<\/ul>\n<p>Visit <strong><a href=\"https:\/\/lms.nextlevelpurchasing.com\/\">NLPA Learning<\/a><\/strong>, the new home to all of our certifications and online courses. The Learning site also includes learning resources, including live and on-demand webinars, publications and reports, articles, templates, white papers, and much more!<\/p>\n","protected":false},"excerpt":{"rendered":"<p>I hope that you have enjoyed the article \u201cPurchasing &amp; [&hellip;]<\/p>\n","protected":false},"author":12,"featured_media":11282,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[28,1,95,22,29],"tags":[],"class_list":["post-2237","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-inventory-management","category-procurement","category-procurement-operations-management","category-procurement-processes","category-supply-chain"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v19.4 (Yoast SEO v19.13) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Purchasing and Inventory Management - Next Level Purchasing Association (NLPA)<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.certitrek.com\/nlpa\/blog\/purchasing-and-inventory-management\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Purchasing and Inventory Management\" \/>\n<meta property=\"og:description\" content=\"I hope that you have enjoyed the article \u201cPurchasing &amp; [&hellip;]\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.certitrek.com\/nlpa\/blog\/purchasing-and-inventory-management\/\" \/>\n<meta property=\"og:site_name\" content=\"Next Level Purchasing Association (NLPA)\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/NextLevelPurchasing\/\" \/>\n<meta property=\"article:published_time\" content=\"2006-12-26T20:18:00+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2021-07-29T08:27:20+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.certitrek.com\/nlpa\/wp-content\/uploads\/sites\/5\/2021\/04\/eoq-e1618238964177.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"404\" \/>\n\t<meta property=\"og:image:height\" content=\"172\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Galo Matagay\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@nextlevelpurch\" \/>\n<meta name=\"twitter:site\" content=\"@nextlevelpurch\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Galo Matagay\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"1 minute\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/www.certitrek.com\/nlpa\/blog\/purchasing-and-inventory-management\/#article\",\"isPartOf\":{\"@id\":\"https:\/\/www.certitrek.com\/nlpa\/blog\/purchasing-and-inventory-management\/\"},\"author\":{\"name\":\"Galo Matagay\",\"@id\":\"https:\/\/www.certitrek.com\/nlpa\/#\/schema\/person\/72d094fab77892483dfa6e061cb27eaa\"},\"headline\":\"Purchasing and Inventory Management\",\"datePublished\":\"2006-12-26T20:18:00+00:00\",\"dateModified\":\"2021-07-29T08:27:20+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/www.certitrek.com\/nlpa\/blog\/purchasing-and-inventory-management\/\"},\"wordCount\":175,\"commentCount\":0,\"publisher\":{\"@id\":\"https:\/\/www.certitrek.com\/nlpa\/#organization\"},\"articleSection\":[\"Inventory Management\",\"Procurement\",\"Procurement Operations Management\",\"Procurement Processes\",\"Supply Chain\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\/\/www.certitrek.com\/nlpa\/blog\/purchasing-and-inventory-management\/#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.certitrek.com\/nlpa\/blog\/purchasing-and-inventory-management\/\",\"url\":\"https:\/\/www.certitrek.com\/nlpa\/blog\/purchasing-and-inventory-management\/\",\"name\":\"Purchasing and Inventory Management - 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