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EOQ Calculator — Economic Order Quantity

Find the optimal order quantity that minimizes your total inventory costs. Free, instant.

Free
Formula: EOQ = √(2 × Annual Demand × Order Cost / Holding Cost per Unit)
How many units you sell per year
Cost to place one purchase order (your time, shipping setup, admin)
Your cost to purchase one unit from supplier
Typically 20–30% of unit cost per year (storage, insurance, capital)
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Frequently asked questions

What is Economic Order Quantity (EOQ)?

EOQ is the optimal order size that minimizes the total cost of ordering and holding inventory. It balances two opposing costs: ordering too often (high ordering costs) vs. ordering too much at once (high holding costs).

What should I use as my holding cost rate?

Most businesses use 20–30% of unit cost annually. This includes warehouse storage (rent per sq ft × space used), insurance, spoilage risk, and the opportunity cost of capital tied up in inventory.

Does EOQ apply to all products?

EOQ works best for products with relatively stable demand. For highly seasonal products, you may want to calculate EOQ separately for peak and off-peak seasons.