Abstract :
Sohun Cap Mawar company is an agroindustry business since 1993 located on Jatiwangi Street, Demangan Village, Taman District, Madiun City. This business is one of the central product of vermicelli noodles with sago flour as the raw material, the company is able to producing 325 kilograms of sago flour every day into vermicelli noodles with depreciation of 20%. This study aims to determine the optimal buying amount of sago flour raw material inventory, when is the right time to do reorder point of sago flour, and how much total inventory cost for the procurement of sago flour raw materials using the Economic Order Quantity (EOQ) method. The type of this research is descriptive research with quantitative methods. The results of the analysis showed that by using the Economic Order Quantity (EOQ) method the optimal order quantity of sago flour raw materials is 24,649 Kg at each order with a purchasing frequency of raw materials is 4 times in a year. Safety stock produced by the EOQ method is 1,008 kg, with reordering sago flour materials when the inventory reaches 1,658 kg. Total inventory costs of sago flour raw materials using Economic Order Quantity (EOQ) method in 2021 is Rp. 29,578,808. Keywords : Supply, Sago Flour Raw Material, Economic Order Quantity (EOQ)