How do I calculate economic order quantity?

It is the square root of (2 × annual demand × cost per order / holding cost per unit per year). For example, sqrt(2 × 10,000 × 50 / 2) is about 707 units.

What is the cost per order?

It is the fixed cost of placing one order: admin time, fixed freight, receiving, and inspection. It does not depend on how much you order.

How do I estimate holding cost per unit?

Take your annual carrying rate (often 20% to 30%) times the unit cost of the product. Our carrying cost calculator helps you size it.

Does EOQ work for variable demand?

The model assumes steady demand. For highly variable demand, use EOQ as a baseline, then adjust with safety stock and reordering rules.

Free Tool · Updated June 30, 2026

Economic Order Quantity Calculator

Find the order size that minimizes total annual cost by balancing ordering cost against holding cost. Free, no email.

The real balance pointSquare root of two times annual demand times order cost, divided by holding cost. No rounding guesswork.
Order cost vs holding costSee how the two costs pull against each other, and why ordering too often or too rarely both cost more.
Orders per year, in daysAlso get the number of orders per year and the days between each order.

Book a Free Audit See how it works

Annual demand (units) Units sold or used per year

Cost per order ($) Fixed cost to place one order

Holding cost ($/unit/year) Cost to hold one unit for a year

Economic order quantity707 units14.1 orders per year

Economic order quantity (EOQ)707 units

Orders per year14.1

Days between orders26 days

The EOQ model assumes steady demand and constant costs. Treat it as a planning baseline, then adjust for reality.

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How This Calculator Works

Economic order quantity (EOQ) is the square root of (2 times annual demand times cost per order, all divided by holding cost per unit per year). Ordering more at once lowers ordering costs but raises holding costs; EOQ is the balance point that minimizes total cost. From there, the calculator derives orders per year and days between orders.

How This Maps to Odoo Inventory

In Odoo, EOQ translates into the order quantity in your reordering rules and the purchase multiples set on your vendors. Instead of ordering at random, you set a lot size that balances your costs. Octura wires those settings to tiered vendor pricing and lead times so each replenishment stays economical.

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Backed by real migrations

Numbers like yours, validated on real migrations

Three engagements where the projection turned into operational reality on Odoo. Read the full case studies on the migration service page.

ManufacturingV12 → V17
Industrial Manufacturer, Texas
12custom modules ported, zero data lost
DistributionV14 → V18
Wholesale Distributor, Quebec
30%faster page loads after the upgrade
Professional ServicesCE → Enterprise
Consulting Firm, Brussels
0hproduction downtime during cutover

Frequently Asked Questions

01How do I calculate economic order quantity?
It is the square root of (2 × annual demand × cost per order / holding cost per unit per year). For example, sqrt(2 × 10,000 × 50 / 2) is about 707 units.
02What is the cost per order?
It is the fixed cost of placing one order: admin time, fixed freight, receiving, and inspection. It does not depend on how much you order.
03How do I estimate holding cost per unit?
Take your annual carrying rate (often 20% to 30%) times the unit cost of the product. Our carrying cost calculator helps you size it.
04Does EOQ work for variable demand?
The model assumes steady demand. For highly variable demand, use EOQ as a baseline, then adjust with safety stock and reordering rules.