A fresh produce distributor uses 800 non-returnable packing, Operation Management

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A fresh produce distributor uses 800 non-returnable packing

A fresh produce distributor uses 800 non-returnable packing crates a month, which it purchases at a cost of $5 each. The manager has assigned an annual holding cost of 25 percent of the purchase price per crate. Ordering cost is $28 per order. Currently the manager orders 800 crates at a time. How much could the firm save annually in ordering and holding costs by using the EOQ?

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Operation Management: A fresh produce distributor uses 800 non-returnable packing

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