EOQ-Based Inventory Control of Brown Clay for NPK Fertilizer at PT. Pupuk Kujang
Keywords:
Inventory management, economic order quantity, brown clay, fertilizer production, supply chain optimizationAbstract
This study investigates the optimization of brown clay inventory management for NPK fertilizer production at PT Pupuk Kujang through the application of the Economic Order Quantity (EOQ) and Total Inventory Cost (TIC) methods. Data analysis of the company’s 2023 operations revealed that existing inventory practices led to high ordering frequencies and significant annual costs, totaling Rp230,709,760. By implementing the EOQ approach, the optimal order quantity was determined to be 3,510 tons, reducing the number of orders to seven per year and lowering total inventory costs to Rp3,608,471. Calculation of the reorder point (ROP) further ensured that raw material replenishment could be scheduled proactively, minimizing the risk of production disruptions due to stockouts. The results emphasize the substantial cost savings and operational efficiency improvements gained from adopting the EOQ model. This research contributes practical recommendations for integrating quantitative inventory control methods and highlights the importance of digital inventory systems in supporting supply chain resilience. The findings have broad implications for similar manufacturing industries seeking to enhance competitiveness through data-driven and systematic inventory management.
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Copyright (c) 2025 Rizky Pratama, Agung Widarman, Haris Sandhi Yudha (Author)
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