Application of the EOQ (Economic Order Quantity) Method in Determining Chemical Supplies in PT. Semen Indonesia

The competition among products has become commonplace in the industrial world in Indonesia. If the producers are unable to maintain the quality of the products they produce, there is a potential for decreasing consumer interest. PT. Semen Indonesia is a company with extraordinary development prospects. Quality control is needed in order to control the product so that when it arrives at the consumer the product is in its best condition, or when the product is still in process, production can be maximized. The method used in this research is Economic Order quantity (EOQ). Based on the resercah, the number of orders for each ingredient is for ammonium nitrate 1, barium chloride 1, ethanol 3, glycerol 1, hydrocloric acid 2, sodium hydroxide 3, strontium nitrate 2. Then, the ROP point or time to reorder each ingredient is for ammonium nitrate 2, barium chloride 4, ethanol 33, glycerol 16, hydrocloric acid 21, sodium hydroxide 4, strontium nitrate 13.


Introduction
Currently competition among products has become commonplace in the industrial world in Indonesia. One of the factors that influence it is the emergence of new competitors, especially in terms of product quality that is continuously maintained. If the producers are unable to maintain the quality of the products they produce, there is a potential for decreasing consumer interest.
PT. Semen Indonesia is a company with extraordinary development prospects, as evidenced by only a few years, the Gresik plant has received many awards such as best effort and others. The high demand for cement has prompted PT Semen Indonesia's new plant to produce cement of the highest quality.
Quality control is needed in order to control the product so that when it arrives at the consumer the product is in its best condition, or when the product is still in process, production can be maximized. one way is to control the chemical compounds in the product. To do this, chemicals are needed that support the process, so that good chemical supply control is needed.

Logistics Management
The definition of logistics management is a strategic management process for the transfer and storage of goods, spare parts and finished goods from suppliers, between company facilities and to customers [1][2].

Logistics management objectives
The objective of logistics management is to repair finished goods and various materials in the right quantity at the right time at the time of need, the conditions that can be used, the location where it is needed and with the lowest total cost. Logistics provides time and place utility. This utility is an important aspect of the company's operations as well as the government [3]. logistic objectives have three objectives, namely: 1. Operational Objectives, so that the availability of goods and materials in the right quantity and adequate quality.
2. Financial objectives include the understanding that operational objectives can be accomplished at the lowest possible cost.
3. The purpose of security is to prevent the inventory from being disturbed by damage, waste, unauthorized use, theft and other improper depreciation.

Inventory
*Corresponding author E-mail address : hidayat@umg.ac.id E-ISSN 2548-4214 227 inventory is used as an unused resource. These unused resources have not been used because they are waiting for the process of production activities as found in the manufacturing system [4].
Marketing activities can be found in the distribution process or consumption activities such as in the household system.There are several types of inventory including raw material supplies, semifinished materials and finished goods supplies [5]. Inventories of raw materials and semi-finished materials before being used / put / used into the production process are stored, while finished goods or merchandise inventories are stored before they are sold or marketed. Therefore companies and small businesses always provide or store raw materials [6].

EOQ (Economic Order Quantity)
Economic order quantity (EOQ) is the most economical amount of purchase, namely by making regular purchases of EOQ, the company will bear the minimal costs of procuring materials [7].
The purpose of this EOQ method is to determine the economic amount per order (EOQ) so as to estimate the total cost of supplies [8].
The simplest EOQ model has the following prerequisites and assumptions: 1. Only one item (product) is counted.
2. The need (demand) for each known period (certain).
3. The goods ordered are assumed to be immediately available (instaneously) or the production rate of the goods ordered (infinity).

The lead time is constant.
5. Each order is received in a single shipment and can be used immediately.
6. There are no back orders due to shortage.
7. There is no discount for the quantity purchased (quantity discount).

Research Method
After all the assumptions have been fulfilled, the following steps are commonly used to process EOQ data.

Determination of the Optimal Amount
To find the optimal number of orders in the EOQ method, you can use the following notation:

Determination of Safety Stock
Safety stock is an additional supply that is held to protect or maintain the possibility of material shortages (stock out). Safety stock aims to determine how much stock is needed during the grace period to meet the large demand. Safety stock can be calculated with the following formula:

Result and Discussion
The costs required in calculating the total cost of inventory are as follows:

Order Fee
Ordering costs are costs incurred in connection with ordering goods from the order of goods to their destination. In the process of ordering raw materials, communication tools are needed to contact suppliers, labor to carry out the order process, as well as order administration requirements for documentation in the form of an attached file. The cost of ordering each material based on the interview results requires the same details of costs and activities, so the cost of ordering each material is the same. The following is a breakdown of the costs included in the booking fee, including:

Telephone Fee
In placing an order, the time to make a call to the supplier from the interview results is estimated to take 15 minutes.

Storage Costs
Storage costs are costs incurred as a result of stored raw materials. The calculation of the fraction of the storage cost of each of these three ingredients is: The interest rate in May 2019 is 5.5%, so the opportunity cost of storing materials is 5.5% Warehouse operational costs include:

Labor costs
Employee working hours for operations at 13.00-17.00 per day.
but employees do not stay put all the time.

Data processing
After collecting the data, the collected data will be processed to determine the optimal number of orders, and to control the right material inventory in the laboratory warehouse of PT. Semen Indonesia using the Eqonomic Order Quantity (EOQ) method.

Determination of Safety Stock
The safety stock for each material used is to add 1 ingredient for each type of material because each material ordering takes 6 months so that when in the process of ordering materials there will be no running out of ingredients.

Conclusion
Based on the research results it can be concluded that:

Suggestion
The company (PT. Semen Indonesia) as a place of research is expected to consider the suggestions given by implementing policies in accordance with the results of observations made, with the aim of being able to provide benefits in the future.