Bachetti

Bachetti, Plebani, Saccani and Syntetos (2010) contends that inventory management got to be organized in a consistent way so that the organization can be able to know when to order and how much to order. This will only be accomplished through the Economic Order Amount (EOQ) computation. Economic order amount enables organization to plan their stock replenishment on a timely basis such as month to month, quarterly, half yearly or yearly basis. By so doing, it empowers firms to have minimal storage costs or zero within their warehouses since stock is coming in and going out instantly.In this way, this tends towards the just in time concept of supply chain management received by Toyota motor Organization in Japan which helps in having zero holding costs, (Schonberger, 2008). In this way, as organizations try to progress on the stock management, the Economic Order Amount (EOQ) and Re-order Point (ROP) are critical tools that organizations can use to guarantee that stock supply does not hit a stock out as explained by Gonzalez and Gonzalez (2010). Over time, organizations have been keeping up their stock in a haphazard way which has required a change within the way firms conduct their business. Stock outs have been experienced adversely leading to client dissatisfaction hence; firms are changing their approach to be able to stay important by employing Economic Order Amount (EOQ) and Re-order Point (ROP) for client satisfaction.