This preview has intentionally blurred sections. Sign up to view the full version.View Full Document
Unformatted text preview: Quantity discount : Depending on the summation of inventory costs and relief resulting out of quantity discounts, the amount of quantity to be economical need to be decided. The benefits of EOQ can be ripped off by quantity discounts if it is not evaluated on the basis of total costs perspective. Production lot size : sometimes buyers EOQ and suppliers EBQ don’t equivalent to each other. In order to make it practicable some changes need to be done. Multiple item purchase : when several items are purchased from a supplier, the impact of quantity discounts and transportation cost varies for the respective products. Thus certain measures need to be taken from the perspective of total cost for the combination of products. Limited capital : while buying budgetary allocations plays an important role. The budget needs to satisfy the needs of entire product line. Thus the EOQ of different items need to be adjusted....
View Full Document
- Spring '10
- Marketing, Discounts and allowances, quantity discounts