economic order quantity (EOQ)

economic order quantity (EOQ) definition - business

economic order quantity (EOQ)

The order quantity for inventory that minimizes the combination of processing and storage costs. Larger orders decrease ordering costs and increase storage costs. Smaller orders increase ordering costs and decrease storage costs.

The American Heritage® Dictionary of Business Terms Copyright © 2009 by Houghton Mifflin Harcourt Publishing Company. Published by Houghton Mifflin Harcourt Publishing Company. All rights reserved.

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