EOQ AND LEAD TIME in hospital pharmacy

1. E.O.Q(economicOrder Quantity) , Lead time
PRESENTED BY:
U.SWATHI
14AB1T0024
UNDER THE GUIDENCE
OF
Dr.Ramesh
VIGNAN PHARMACY COLLEGE VADLAMUDI

2. E.O.Q (economic Order Quantity) , Lead time

3. CONTENTS
DEFINITION
ORDERING COST
CARRYING COST
ASSUMPTIONS FOR E.O.Q
LEAD TIME
PROCESS TIME
REFERENCES

4. E.O.Q (economic Order Quantity) , Lead time

6. E.O.Q :
•One of most effective techniques for determination
of quantity is economic order quantity.
•The basic objective of E.O.Q is to have an ideal
order quantity
•For any item and to ecnomise on the cost of
purchase
•Managing of inventory depends on 2 factors:
Ordering cost
Carrying cost

7. ORDERING COST:
•It is also known as purchasing cost or acquisition cost
•It involves cost of inventing questions , deciding the
supplies issuing purchasing order fellow of etc..
•There are also inspection cost , and cost of receiving the
items.
•It is also defined as itemised list of medicines procured
in right quantity , right quality ,
At right time in right price from right suppliers

11. LEADTIME:
A lead time is the latency between the initiation and execution of
a process. It denotes the average duration in days between
placing an order and receipt of material.
•Internal lead time is the time taken to review the demand,
trade inquiries, tenders, quotations and final approval from the
competent authority.
•External lead time is the time taken by the supplier to supply
the materials after it receives the supply order from an
organisation.

13. Lead time = ordering time + delievery time + receiving time

14. Lead time is made of:
Pre processing Lead Time
(also known as "planning time" or "paperwork"): It represents
the time required to release a purchase order (if you buy an
item) or create a job (if you manufacture an item) from the
time you learn of the requirement.
Processing Lead Time:
It is the time required to procure or manufacture an item
Post processing Lead Time:
It represents the time to make a purchased item available in
inventory from the time you receive it (including quarantine,
inspection, etc.

16. •Order Lead Time
Time from customer order received to customer order
delivered.
Order Handling Time - Time from customer order received to
sales order created.
Manufacturing Lead Time - Time from sales order created to
production finished (ready for delivery).
Production Lead Time - Time from start of physical
production of first submodule/part to production finished
(ready for delivery).
Delivery Lead Time - Time from production finished to
customer order delivered.

17. REFERENCES:
•A TEXTBOOK OF HOSPITAL PHARMACY BY – TIPNIS-PGNO:
•en.wikipedia.org/wiki/Economic_order_quantity
•A TEXTBOOK OF HOSPITAL PHARMACY BY-
SUBHRAMANYAM
•scm.ncsu.edu/scm-articles/article/economic-order.