Implementation of Economic Order Quantity (Eoq) In Inventory Management: A Case Study of Chopfee Coffee Shop

Abstract

Inventory management is a critical aspect of operational success for businesses, including the food and beverage industry. This study aims to analyze the application of the Economic Order Quantity (EOQ) method to optimize raw material inventory management at Chopfee, a coffee shop business. This research adopts a quantitative descriptive approach to systematically collect and analyze data. Data were gathered from Chopfee’s internal records, including information on ordering costs, storage costs, and the quantity of supplies used for operations. The EOQ method was employed to determine the optimal order quantity to minimize inventory-related costs. The findings indicate that Chopfee currently uses conventional methods for inventory management. By implementing the EOQ method, inventory costs could be reduced from IDR 2,392,357 to IDR 677,170, representing a 71.7% cost reduction (IDR 1,715,186). This demonstrates the potential for significant cost savings and profit optimization through improved inventory management practices. The study highlights the importance of adopting the EOQ method to address inefficiencies in inventory management, enabling Chopfee to enhance long-term profit margins while better aligning with customer demand and operational constraints. This research provides actionable insights into the benefits of integrating the EOQ method for inventory management in small-scale businesses within the food and beverage sector, offering a pathway for enhanced efficiency and profitability.