Formation of storage classes in the presence of space cost for warehouse planning Online publication date: Tue, 03-Oct-2006
by Venkata Reddy Muppani, Gajendra Kumar Adil
International Journal of Services Operations and Informatics (IJSOI), Vol. 1, No. 3, 2006
Abstract: The procedures reported in the literature for the formation of storage classes generally ignore the effects of storage area reduction on order picking and storage space cost. Further, they exclude non-cube per order index based groupings and this exclusion may lead to inferior solutions. We consider these issues in this paper and develop a mathematical model and two solution approaches: dynamic programming and Merge-Sort Heuristic (MSH) for determining storage classes with an objective of minimising the sum of storage space cost and order picking cost. The algorithms are illustrated with an example and applied to an industrial case. Computational experience on randomly generated data sets shows that MSH gives solution with objective value closer to dynamic programming with computer time which is an order of magnitude lesser. This increases its applicability for large sized problems. At times, it has also been observed that MSH offers a better solution.
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