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Glossary ยท business

MOQ

The smallest order quantity โ€” in units or value โ€” that a supplier will accept, imposing a hard lower bound on every replenishment regardless of buyer demand.

Minimum Order QuantityMinimum Order SizeOrder Floor
Minimum Order Quantity (MOQ) is the smallest quantity, or monetary value, a supplier accepts on a single purchase order. Suppliers enforce MOQ to protect their production batch size, setup cost, freight integrity or minimum revenue. On the buyer side, MOQ binds the operational order to Q = max(Q*, MOQ) โ€” even when the classical EOQ optimum sits below the floor. In SMB importing, MOQ is especially heavy: 40-foot container integrity, FOB minimums of USD 5,000 or 1,000 units per batch are common. The MOQ constraint directly affects EOQ economics (#093), joint replenishment savings (#050) and supplier selection (#015). Two strategic responses exist: (1) accept the MOQ and absorb the extra carrying cost โ€” expensive for small steady demand, (2) consolidate several SKUs from the same supplier into one shipment to share the MOQ across items โ€” captured by the joint replenishment framework. Some suppliers accept below-MOQ orders for a 'small order fee'; the trade-off then becomes carrying cost versus that surcharge. MOQ is a negotiable parameter: as annual committed volume grows, the floor can usually be pushed down.
ร–rnek

A stationery wholesaler imports pens from a far-east supplier; classical EOQ gives Q* = 1,200 dozen, but supplier MOQ is 2,500 dozen. The operational order rises to 2,500 dozen, covering eight months of demand, and annual carrying cost rises about 35%. Once the SMB bundles four SKUs from the same supplier into one joint container, the MOQ pressure is shared across items and total cost falls 18%.

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