Applying An EOQ Model For Non- Instantaneous Deteriorating Items A Case Study For Inventory Management Of A Fertilizer Retailer

Abstract

The Economic Order Quantity (EOQ) model has been a widely used model in the last several decades. It is defined as a method to identify the optimal number of products to order and there have been many researches carried out to modify and develop the model in order to apply for the actual inventory problem. Inspired by the idea of the model, this thesis applies a developed EOQ model for a retailer in planning for annual inventory. The model would be able to find out the order size together with the appropriate replenishment time for products considering the time that products are non-deterioration and deterioration. Based on the set of inputs of practical issue, many mathematical formulas were used to determine the existence of the optimal solution to minimize the total relevant inventory costs.