# Epicor EOQ and Lot Sizing Calculator

> Source: https://netray.co/tools/epicor-eoq-lot-sizing-calculator
> Publisher: Netray (netray.co), AI and integration engineering for ERP and manufacturing systems.
> Section: Free Tools

## Short answer

Compute economic order quantity, orders per year and total annual cost, then round to the multiple you enter in Epicor.

## Category

epicor

## Erp

Epicor Kinetic

## Industry

Discrete Manufacturing

## Audience

- Materials planner
- Buyer
- Production planner

## Tool

**Kind:** calculator

**Inputs:**

#### Annual demand

**Key:** annual_demand

**Type:** number

**Default:** 12000

**Min:** 0

**Step:** 100

**Unit:** units/year

#### Cost per order or setup

**Key:** setup_cost

**Type:** number

**Default:** 120

**Min:** 0

**Step:** 5

**Unit:** $

**Help:** Setup labor and burden for a job, or PO handling cost for a buy part.

#### Unit cost

**Key:** unit_cost

**Type:** number

**Default:** 14

**Min:** 0

**Step:** 0.1

**Unit:** $

#### Annual carrying cost rate

**Key:** carry_rate

**Type:** number

**Default:** 22

**Min:** 0

**Max:** 80

**Step:** 1

**Unit:** %

**Help:** Capital, storage, handling, obsolescence and insurance, as a percent of unit cost.

#### Order multiple

**Key:** mult

**Type:** number

**Default:** 50

**Min:** 1

**Step:** 1

**Unit:** units

**Help:** Pack size or supplier multiple from the Part Plant planning screen.

**Outputs:**

#### Holding cost per unit per year

**Key:** hold

**Expr:** unit_cost * carry_rate / 100

**Format:** currency

#### Economic order quantity

**Key:** eoq

**Expr:** sqrt(2 * annual_demand * setup_cost / hold)

**Format:** integer

**Primary:** true

#### EOQ rounded to multiple

**Key:** eoq_r

**Expr:** ceil(eoq / mult) * mult

**Format:** integer

**Primary:** true

**Description:** Value to consider for the order quantity setup.

#### Orders per year

**Key:** orders

**Expr:** annual_demand / eoq_r

**Format:** decimal

#### Days between orders

**Key:** cycle

**Expr:** 365 / orders

**Format:** days

#### Annual ordering plus holding cost

**Key:** total

**Expr:** annual_demand * setup_cost / eoq_r + eoq_r / 2 * hold

**Format:** currency

**Chart:**

#### Rounded EOQ vs cost per setup

**Type:** line

**X:** setup_cost

**From:** 10

**To:** 500

**Steps:** 25

**Series:**

- eoq_r

**Currency:** $

**Disclaimer:** Classic EOQ assumes steady demand, no quantity discounts and no capacity limits.

## Content

**Intro:** Lot size decides how often you set up machines or raise purchase orders, and how much cash sits on the shelf. This calculator gives the classic economic order quantity, rounds it to a realistic multiple, and prices the result. It is aimed at the people who maintain order quantity rules on the Epicor Part Plant planning screen.

**Sections:**

#### How to use it

**Body:** Enter annual demand, then the cost of one order. For a make part that is setup hours multiplied by the setup rate, plus burden. For a buy part it is the handling cost of a PO line. Add the unit cost and a carrying rate; 15 to 30 percent is typical. The multiple is the pack size or the supplier rule you maintain in Epicor. The rounded EOQ is what you would consider keying as the order quantity. Compare the total cost at that value against your current setting.

#### The EOQ formula

**Body:** EOQ equals the square root of two times annual demand times cost per order, divided by holding cost per unit per year. At the EOQ, annual ordering cost equals annual holding cost, and total cost is flat near the optimum, which is why rounding to a pack size rarely hurts. The chart shows that quadrupling the setup cost only doubles the lot size, because of the square root.

**Bullets:**

- Halve setup time and EOQ falls by about 29 percent
- Double demand and EOQ rises by about 41 percent
- Total cost is shallow near the optimum, so round freely

#### Using the result with MRP

**Body:** MRP applies minimum, maximum and multiple quantities when it turns requirements into suggestions. A fixed lot size from EOQ will produce a steady pattern of jobs and POs, but it can overbuild when demand is lumpy. For make-to-order parts, lot-for-lot is usually right and EOQ should be ignored. Use this tool for repeat parts with stable demand and meaningful setup cost, and review the result when the setup time changes after a process improvement.

#### Common mistakes

**Body:** The most common error is a carrying rate that omits obsolescence, which pushes lot sizes too high. The second is using list unit cost when a price break changes the picture; check the break quantity separately. Finally, EOQ ignores capacity: a large lot on a bottleneck machine can starve other jobs, so check the resulting run time before committing.

**Cta:** If you would like lot size and safety stock suggestions generated for your whole part master from Epicor data, we can set that up as a reviewed report.

**Faq:**

#### Should I use EOQ for every part?

**Answer:** No. EOQ suits repeat parts with steady demand and real setup cost. Make-to-order and lumpy parts usually do better with lot-for-lot planning, and parts with price breaks need the discount logic checked as well.

#### What carrying cost rate is realistic?

**Answer:** Many manufacturers use between 15 and 30 percent of unit cost per year. Include cost of capital, storage, handling, insurance, shrinkage and obsolescence. Ask finance for the rate they use so the numbers match.

#### Why round to a multiple?

**Answer:** Suppliers ship in packs and shop jobs often run in standard tray or pallet counts. Rounding up to the multiple keeps the order practical, and the cost penalty is usually small because total cost is flat near the optimum.

#### How does this relate to Epicor min and max quantity?

**Answer:** Epicor lets you set minimum, maximum and multiple order quantities on Part Plant planning. EOQ is one way to choose a sensible value for these fields. It does not replace judgement about capacity or shelf life.

## Search terms

epicor eoq, economic order quantity calculator, epicor lot sizing, epicor multiple quantity, epicor minimum order quantity, eoq calculator excel, epicor mrp order quantity

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