A Planning Purchasing Policies for Raw Material Welding Wire Using Economic Order Quantity (EOQ) Method to Reduce Overstock

Procedia of Engineering and Life Science Pub Date : 2024-02-21 DOI:10.21070/pels.v7i0.1587

Mike Vidiasari, R. B. Jakaria

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Abstract

This study aims to determine the optimal order quantity of K71T welding wire for PT BMI's boiler production process to reduce storage and inventory costs. The Economic Order Quantity (EOQ) method is applied to calculate the optimal amount of material to be ordered in one period. The results show that the total inventory cost using the EOQ method is Rp. 89,060,000,- compared to the company policy of Rp. 290,840,000,-. The optimal number of orders is 407 boxes with a purchase frequency of 4 times per year and a safety stock of 181 boxes. The findings of this study can be used as a reference for other manufacturing companies that face similar procurement challenges to optimize their inventory management and reduce costs. Highlight : The study determines the optimal order quantity of K71T welding wire, reducing storage and inventory costs. The Economic Order Quantity (EOQ) method is applied, resulting in a total inventory cost of Rp. 89,060,000,- compared to the company policy of Rp. 290,840,000,-. The findings can be used as a reference for other manufacturing companies facing similar procurement challenges to optimize their inventory management and reduce costs. Keywords: welding wire, optimal order quantity, inventory management, procurement challenges, manufacturing companies

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使用经济订货量（EOQ）法规划原材料焊丝采购政策以减少超量库存

本研究旨在确定 PT BMI 锅炉生产过程中 K71T 焊丝的最佳订购量，以降低存储和库存成本。经济订货量（EOQ）法用于计算一个时期内的最佳订货量。结果显示，使用 EOQ 方法计算的总库存成本为 89,060,000 印尼盾。89,060,000 印尼盾，而公司的政策是 290,840,000 印尼盾。最佳订单数量为 407 箱，采购频率为每年 4 次，安全库存为 181 箱。这项研究的结果可供面临类似采购挑战的其他制造企业参考，以优化其库存管理并降低成本。亮点：本研究确定了 K71T 焊丝的最佳订购量，降低了存储和库存成本。采用经济订货量（EOQ）方法，总库存成本为 89,060,000 印尼盾，而公司政策为 290,840,000 印尼盾。研究结果可供面临类似采购挑战的其他制造企业优化库存管理、降低成本时参考。关键词：焊丝、最佳订货量、库存管理、采购挑战、制造企业

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Procedia of Engineering and Life Science

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