Improving the productivity of order picking of a manual-pick and multi-level rack distribution warehouse through the implementation of class-based storage

Determining the proper storage locations for potentially thousands of products is one major task that faces the warehouse manager during the design of a new warehouse or the refurbishment of existing facility. There are many factors affects the storage assignment. For example, order picking method, size and layout of the storage system, material handling system, product characteristics, demand trends, turnover rates and space requirements. Selecting appropriate storage assignment policies (i.e. random, dedicated or class-based) and routing methods (i.e. transversal, return or combined) with regards to above factors is a possible solution to tackle this problem. However, the efficiency of these policies is interdependent. This paper aims to present a simulation study of a real case regarding storage assignment problem of a manual-pick and multi-level rack warehouse. Performance of the case is measured in terms of travel distance and order retrieval time. The results of the study indicate that the key to effective implementation of a storage assignment system is to match the types of warehouse storage system and the variety of items in the customer order. Also, the use of key performance indicator should clearly reflect the needs of the warehouse.