Short & sweet: Sliding economic lot size

The sliding economic lot size is a method widely used in practice to determine economic order quantities or production lot sizes. Like all methods for determining economic lot sizes, the method attempts to determine the quantity of items to be ordered or produced for which the sum of inventory costs and lot run costs is minimal.

To do this, it combines as many future requirements into one order or production order as the sum of the lot size fixed costs, order or setup costs and the resulting inventory costs, converted to the individual ordered piece of a lot, is minimal.

The calculation algorithm of the sliding economic lot size leads to a different result than the part-period method, which is also widely used.

Our tip:

Also read our 2021 update: Batch size optimization

Both the moving economic lot size and the part-period method are approximation methods that only ask what size the next order or the next finished lot should be. They do not try to put together the individual batch sizes as optimally as possible over the entire planning horizon. It is better to use the Wagner-Whitin procedure if your ERP or scheduling system provides this.

Picture of Prof. Dr. Andreas Kemmner

Prof. Dr. Andreas Kemmner

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