Recently. AGV systems are used to serve the raw material to each work stations automatically. There exists a trade-off between the adequate service supply and the number of purchased AGVs. Also, to reduce the overall production cost, the amount of inventory hold on the shop floor should be considered. In this paper, we present a heuristic technique for determining the number of AGVs which includes the net present fixed costs of each station, each purchased AGV, delivering cost, stock inventory cost, and safety stock inventory cost. Secondly, by using a genetic algorithm, the optimal number of AGVs and the optimal reorder quantity at each station are decided. Lastly, to verify then heuristic algorithm, we have done a computer simulation with different GA parameters.