Work the EOQ for core drinks
Use EOQ logic to choose an order quantity that balances order effort and inventory holding cost.
Sparkling water demand is 108 cases per year. Each order costs about $18 in delivery fee or pickup time. Holding one case costs about $2.40 per year in storage, cash cost, damage, and stale risk. EOQ balances ordering cost against holding cost The common trap is treating free delivery as free inventory. A large order still has holding cost, cash cost, and storage friction. Name annual demand 9 cases per month x 12 months = 108 cases per year. EOQ needs demand over the same time period as holding cost. Estimate ordering cost Delivery fee or pickup time is estimated…
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