But if you order more than you can sell, you will start to rack up holding costs. Businesses use the EOQ formula to help them reduce their overall inventory costs. » MORE: Best small-business apps ...

The EOQ formula is the square root of (2 x 1,000 pairs x $2 order cost) / ($5 holding cost) or 28.3 with rounding. The ideal order size to minimize costs and meet customer demand is slightly more ...

The Economic Order Quantity (EOQ) is the number of units that a company should add to inventory with each order to minimize the total costs of inventory—such as holding costs, order costs, and ...