On the Effect of Product Demand Correlation on the Storage Space Allocation Problem in a Fast-Pick Area of a Warehouse

Abstract

The storage location assignment problem (SLAP), also known as the slotting problem involves the decisions of how much and where should be stored each stock keeping unit (SKU) in the fast-pick area with the aim to minimize total order-picking and replenishment costs associated to the distance traveled by the picking operators. Motivated by this, we propose to analyze the impact of SKUs demand correlation on the slotting decisions. Based on an experimental design, the effects of SKUs with correlated demand are analyzed. Results show that the most significant factor with respect to the total distance traveled is the number of orders, followed by the capacity of the bins and the number of bins in each location. Results of an instance solved to optimality by a commercial solver and a greedy heuristic in which the latter does not consider the demand correlation illustrate the impact that demand correlation has on the solution obtained.