The Economic Order Quantity (EOQ) calculation is an essential business tool that helps companies determine the optimal order quantity for their inventory. In simple terms, it helps to balance the costs of ordering and holding inventory to find a point of equilibrium where stock levels are kept to a minimum and businesses can order when they need without having too much inventory on hand. With the EOQ calculation, businesses can save time and money by reducing the number of orders they place and eliminating excess inventory, which ultimately allows them to be more profitable in the long run.