fixed order quantity method

Previous Definition
Next Definition
Popular Terms
Definition
A method that only allows for a specific amount of a given item to be ordered at one time. This type of rule helps to limit reorder mistakes, conserve storage space, and prevent unnecessary expenditures that would tie up funds that could be better utilized elsewhere. The fixed order quantity may be linked to an automatic reorder point where a specific quantity of a product is ordered when stock on hand reaches a predetermined level.