Analysis of Inventory Calculation Between the Just In Time Method and the Economic Order Quantity Method at PT. Ohtomi Indonesia

Just In Time Method and the Economic Order Quantity Method at PT. Ohtomi Indonesia

Abstrak

Purpose – This research discusses Cost Efficiency. The objective is
to assess which method is more efficient in reducing inventory costs.
The study employs the Just In Time method and the Economic Order
Quantity method.

Design/methodology/approach – This research was conducted at
PT. Ohtomi Indonesia. The type of research is qualitative. The data
sources used in this study include raw material purchases, ordering
costs, and storage costs in 2024. The analysis method applied is a
comparison between the Just In Time method and the Economic
Order Quantity method.

Findings – At company PT. Ohtomi, there is a discrepancy between
theory and practice in the application of inventory control methods.
Theoretically, the Just In Time (JIT) method should be able to reduce
storage costs since the company does not need to maintain large
stock. However, field data shows that inventory costs under the JIT
method are actually higher compared to the Economic Order
Quantity (EOQ) method.

Research limitations/implications –
1. This research was
conducted only at PT. Ohtomi Indonesia and does not cover other
manufacturing companies.
2. The study focuses on inventory management for cost efficiency.
3. The data used in this research are internal company data, such as
raw material purchase reports and raw material usage for production
from January to December 2024.