Multi-Item Inventory Control Using Economic Order Quantity (EOQ) Model with Safety Stock, Reorder Point, and Maximum Capacity in Retail Business

Abstract

The presence of retail businesses in Indonesia has many positive impacts on the community, especially in improving the economy. The existence of buying and selling transactions involving suppliers, retailers, and the community as consumers can play a role in improving the national economy. Retail can be called a bridge for suppliers and consumers to meet their needs. The diversity of consumer needs requires retailers to provide a variety of products from many suppliers. Efforts that need to be made by retail businesses in order to minimize costs incurred are by controlling inventory. To prevent excessive expenditure, the inventory control method used is to apply the Economic Order Quantity (EOQ) model. The EOQ model can provide the optimum total inventory cost by adjusting the frequency of orders placed over a period of time. After obtaining the total inventory cost, the calculation of safety stock, reorder point, and maximum capacity can also be applied so that the inventory costs incurred can be minimal.