Publication Details
Abstract
Objective: Suboptimal material inventory control in construction projects has the potential to trigger cost overruns. PT XYZ currently procures steel bar materials based on field demand without economic order quantity calculations, which potentially increases inventory costs. Methods: his study aims to describe steel materials inventory control using the Economic Order Quantity (EOQ) method. This study uses a descriptive qualitative approach. Results: the company's conventional method, with an average order quantity of 100.26 tons and an order frequency of 84 times per year, resulted in a total inventory cost of IDR 104,998,800.00. Meanwhile, the application of the EOQ method produced an optimal order quantity of 1,172.03 tons with an order frequency of 7 times per year and a total inventory cost of IDR 8,057,857.04. These findings show that the EOQ method is able to reduce total inventory costs by IDR 96,940,942.96, compared to the method applied by the company. Novelty: this study lies in the direct application of the EOQ method to a case study of steel materials procurement in a toll road project, demonstrating the significant cost-efficiency potential compared to the field demand based procurement practice still used by the company. These findings confirm that EOQ can serve as a policy evaluation tool for more efficient inventory control.