How big a batch?

Make or buy in big batches and each setup is cheap per unit — but the stock sits around costing you to hold. Go small and holding is cheap, but you pay the setup costThe fixed cost of starting a batch, however big: a machine changeover, a purchase order, a deploy, a context switch. It's the same whether the batch is one unit or a thousand. again and again. The economic batch size is where those two pulls balance — and the same maths sizes order quantities, production runs, and how much work to ship at once.

We get throughunits per. Each batch coststo set up, and holding one unit ties upper month.
Right now we batchunits at a time.
490 units per batch · 2.4 batches per month · €980 / month
TotalHoldingSetup
€2,7k
01,000optimal · 4901,500

batch size (units) →

490economic batch
€980cost / month
+€20over, at 400
Near optimalBatching 400 is within a whisker of the 490-unit optimum — only €20 (2.1%) more per month. The curve is famously flat near the bottom, so "roughly right" is good enough.
Batch sizeCost / month
245 units
€1,2k
+25%
367 units
€1k
+4.2%
490 unitsoptimal
€980
the minimum
735 units
€1,1k
+8.3%
980 units
€1,2k
+25%

Halve or double the batch and total cost barely moves — being off by a third costs only a few percent. That's the gift of the EOQ curve: you don't need the exact number, just the right ballpark. Tap a row to set it as your batch.

the Economic Order Quantity, first written down by Ford W. Harris in 1913 and still humming along inside every ERP system