Optimal warehouse design: Literature review and case study application

Abstract

This paper investigates the effectiveness of designing warehouses to determine average order picking time and travelled distance using a data mining technique. Order picking is a warehouse operation that is repeated for each order. Therefore, it can have a significant impact on system efficiency. Based on this framework, three issues are examined in this study, the effectiveness of warehouse design, an assignment problem is solved with using a new proposed mathematical model and a Multidimensional Scaling Algorithm (MDS), and order picking process. The proposed mixed integer quadratic model consists of associations rules related to a customer's consumption pattern, capacity of the items, and stores both the distance among items and staging area. The routes from a large number of randomly selected picking requests are sorted by integer linear mathematical model which bases on the Vehicle Routing Problem (VRP). The effectiveness of the warehouse design, alternative assignments and different order picking policies are evaluated by using a simulation method on a real life problem. This study may cause to minimization of fork lift numbers, worker numbers, overtime payments and congestions of forklift drivers. Moreover, system throughputs and customer satisfaction is increased. Results of the study shows that the proposed approach using the mathematical model produce much more favourable results for the warehouse management.