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PLRD-82-108 1 (1982-08-18)

handle is hein.gao/gaobabdol0001 and id is 1 raw text is: 1,1q X4


BY THE U.S GENERAL ACCOUNTING OFFICE



Report To The Administrator

Of Veterans Affairs


VA Should Use Economic Order Quantity

Principles In The Wholesale Supply System




Changes in wholesale supply operations at
the Veterans Administration could reduce
net ordering and carrying costs, inventory
investment, and warehouse space. The pri-
mary vehicle for achieving these reductions
is the economic order quantity principle--a
mathematical method for determining the
purchase quantity that will result in the
lowest total cost to order and carry inven-
tory. Additional reductions are possible by
basing safety stock requirements on varia-
tions in customer demands and procure-
ment leadtime requirements on actual expe-
rience.


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   119226


GAO/PLRD-82-108
AUGUST 18. 1982

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