Economic Order Quantity Analysis of Packaging Enterprise's Inventory (II)

If the user purchases a large quantity, the supplier will provide a lower price, ie a quantity discount. The price reduction is usually discrete or jumping, not continuously changing. If there are quantity discounts, we must weigh the price concessions for large quantities of purchases, reduce the costs associated with fewer ordering times, and compare the increase in holding costs associated with higher inventory levels, and see if quantity discounts can make the enterprise really Reduce costs. In the case of a quantity discount, the user's goal is to pursue the minimum amount of order for the total cost. The total cost consists of ordering costs, purchase costs, and holding costs. That is, total cost (TSC)=(Q/2)C+(D/Q)S+PD, where P is the unit price.

In practical application, the general holding cost has two forms: the holding cost is a constant, and the holding cost is a percentage of the price. There is little difference between the two situations. The example of quantity discounts is illustrated by the constant holding cost.

Assuming that a packaging manufacturer needs 900 barrels of adhesive per year, the ordering cost is 20 yuan and the holding cost is 6 yuan. That is, D = 900 barrels/year, S = 20 yuan, and C = 6 yuan/barrel/year. The price of supplier adhesives varies with the number of purchases, as shown in the following table:

Therefore, since each batch of 120 barrels has the lowest total cost, 120 barrels is the optimal order quantity for the entire feasible range. At this time, the total cost is 32,910 yuan.

In production practice, since the price discount increases with the number of purchases, purchasing more than the optimal order quantity tends to be more cost-effective, but special care must be taken to make a correct assessment of the storage cost and outdated risks of the goods. .

The economic order quantity solves the problem of how many items are ordered. If you want to determine when to order, you must also calculate the best order point, which is not described in this article. If the order time interval is fixed, use the regular order model to order.

Economic order quantities can reduce inventory, reduce costs, and increase business efficiency. However, in actual applications, it is necessary to pay attention to the correct assessment of holding costs and ordering costs. Packaging companies must determine whether their inventory management systems and economic ordering batch models are in compliance. If they meet the model conditions, they can only be used. If they do not meet the conditions of the economic order batch model, they cannot be impersonated. Otherwise, they can only produce erroneous results and cause problems for enterprises. loss.

(Wang Yuxin)

China Packaging News