ERP & MRP Planning worked example

Economic Order Quantity with annual demand quantity of 12,000 units / yr: a worked example

Here is what the math looks like when conditions slip. We hold every other input steady and drop annual demand quantity to 12,000 units / yr, then walk the calculation through step by step. Estimate a practical manufacturing order quantity from annual demand, planned order cycles, and lot-size adjustment.

The inputs for this scenario

  • Annual demand quantity: 12,000 units / yr (the input this scenario stresses; the baseline uses 24,000)
  • Planned order cycles per year: 48 orders / yr (held at the documented default)
  • Lot-size adjustment factor: 1.1 x (held at the documented default)

Working through the calculation

  • The calculation starts from the formula this tool documents: Planning order quantity = annual demand quantity ÷ planned order cycles per year × lot-size adjustment factor.
  • Estimated economic order quantity works out to 275 units at these inputs, and this is the headline figure for the scenario.
  • Average quantity per order cycle works out to 250 units at these inputs.
  • Lot-size adjustment factor works out to 1.1 x at these inputs.
  • Planned order cycles per year works out to 48 orders / yr at these inputs.

How this compares with the baseline

  • Against the tool's baseline example, where annual demand quantity sits at 24,000 units / yr and the headline result is 550 units, this scenario comes in 50% below the baseline at 275 units.
  • The practical read: the gap between this scenario and the baseline is entirely attributable to annual demand quantity, so recovering it is worth quantifying in dollars before considering equipment or staffing changes. This is a cycle-based planning lot size, not the classic square-root EOQ; it does not directly weigh ordering cost against holding cost, so validate the order-cycle count against those economics separately.

Results at a glance

  • Estimated economic order quantity: 275 units (headline result)
  • Average quantity per order cycle: 250 units
  • Lot-size adjustment factor: 1.1 x
  • Planned order cycles per year: 48 orders / yr

Run it with your numbers

  • To rerun this with your own numbers, open the live Economic Order Quantity calculator, set annual demand quantity to your actual value, and adjust the remaining inputs to match your operation.

Last reviewed 2026-05-12.