Economic order quantity–reorder point (EOQ-ROP)

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Classical approach to inventory management, based on expected demand and the predictability of demand.  If demand is constant, and the lead time for orders is also constant,  the level of inventory at which to order new inventory can be determined.

Companies which adopt this method  often factor in safety stocks.   This is a level of inventory beyond anticipated needs, that provides a cushion in the event that the inventory replenishment is delayed, or greater than expected demand. 

Compare: JIT

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