Application of the Economic Order Quantity (EOQ) Method on the Supply of Chemical Materials in the Laboratory of PT. Fajar Surya Wisesa Tbk

Abstract

The chemical inventory management at the Waste Water Treatment Plant (WWTP) Laboratory of PT. Fajar Surya Wisesa Tbk faces challenges in determining the optimal order quantity, ideal reorder time, and appropriate Safety Stock (SS) to minimize ordering and storage costs. This research aims to provide solutions using the Economic Order Quantity (EOQ) method to determine the optimal order quantity, Reorder Point (ROP) calculations to determine the reorder time, and Safety Stock (SS) calculations to maintain the availability of chemical supplies. The research method used is a quantitative method with a descriptive approach. Data is processed using POM for Windows (POM QM) software to calculate EOQ, ROP, and SS. The research results show that using the EOQ method, PT. Fajar Surya Wisesa Tbk can determine the optimal order quantity for each type of chemical. For example, the optimal order quantity for Ammonia Nitrogen is 3 boxes with a total annual cost of Rp 150,525,100. The ROP calculation for Sulfate is 2 boxes, while the SS for Water Hardness is determined to be 1 box. The conclusion of this research is that by applying the EOQ, ROP, and SS methods, PT. Fajar Surya Wisesa Tbk can optimize the chemical inventory management in the WWTP laboratory. This method helps minimize total inventory costs and ensures the availability of chemical supplies for smooth operations. The research recommends the company adopt a more integrated inventory management system and utilize information technology for real-time inventory monitoring, thereby increasing operational efficiency and minimizing the risk of operational disruptions due to inventory shortages.