Class-Based Storage Assignment in a Unit-Load Warehouse Employing AS/RS with Inventory Space Allocation Considering Product Specific Setup to Holding Cost Ratio

Abstract

Many authors have used continuous optimization models for class-based storage allocation for unit load warehouses employing AS/RS system assuming the same setup to holding cost ratio for all products in their EOQ inventory policy. Accordingly, an ABC curve based on demand ordering of products is used to determine pallet turnovers in their travel distance models which is not applicable in many practical situations and can be inaccurate. This paper develops a new model to determine two/three class optimal partitions while relaxing assumption of constant setup to holding cost ratio in the EOQ formula and as a consequence uses an ABC curve based on decreasing ranking of product turnovers rather than that based on demand. Computational experience shows that this new continuous model approximates pick travel distances which are very close to as compared to that of a semi-discrete model (SDM) proposed in this paper. Further computational experiments are also provided comparing traditional models with our formulations.