Raw Material Inventory Control at PT Pegaunihan Technology Indonesia Using the Economic Order Quantity (EOQ) Method

Abstract

This purpose of study this to evaluate the raw material inventory control system at PT Pegaunihan Technology Indonesia by comparing the company's conventional inventory management policy with the Economic Order Quantity (EOQ) approach. The study employs a quantitative descriptive method, with data collected through interviews and documentation. Interviews were conducted with three employees of PT Pegaunihan Technology Indonesia who were directly involved in inventory management activities. The results indicate that inventory control using the EOQ method is more efficient than the inventory management system currently implemented by the company. In 2024, the company's inventory cost amounted to IDR 87,656,612, with raw material procurement conducted 42 times per year and an order quantity of 1,228 sheets per order. By applying the EOQ approach, inventory costs could be reduced to IDR 74,798,750, while the optimal order quantity was reduced to 679 sheets per order with an ordering frequency of 39 times per year. This resulted in potential cost savings of IDR 12,857,862.In 2025, the company's inventory cost reached IDR 99,294,293 with procurement activities conducted 43 times per year and an order quantity of 1,228 sheets per order. By implementing the EOQ method, inventory costs could be reduced to IDR 82,380,041, with an optimal ordering frequency of 43 times per year. The results demonstrate potential inventory cost savings of IDR 16,941,252.