EOQ: Surfboard Orders

1
EOQ Surfboard Orders

• Dals Surfboard Shop has a sales forecast of 10
  boards-per-month. The cost of placing an order
  Co for new boards is 50 and the monthly storage
  or carrying cost Cc is 10. How often should Dal
  order boards?

10
Qopt 10 boards ? 1 order/month
2
Ordering Blank DVDs

• Erins Camera Shop stocks and sells blank DVDs,
  about 50 cases/year. The cost of placing an
  order is 5, the yearly storage cost/case is 5
  and the cost of capital/case is 5 (loan to cover
  inventory cost). How many DVD cases should Erin
  order at a time?

7.071
Qopt 7 cases (or 7 times-per-year)
3
Card Shop
You manage a greeting card shop. It costs you
0.10/year to store a box of cards, and 15 to
place an order. If you sell 300 boxes/year, how
often should you order cards? Co - cost of
placing order Cc - annual per-unit carrying
cost D - annual demand Q - order quantity
Order once-per-year
4
Card Shop
If the storage costs increase from 0.10/year to
1/year, what is the new optimal order
quantity? Co - cost of placing order Cc -
annual per-unit carrying cost D - annual demand Q
- order quantity
Order three time/year