 Forward-reserve storage strategies with order picking: When do they pay off?Wan Wu, René B.M. de Koster and Yugang Yu IISE Transactions, 2020, vol. 52, issue 9, 961-976 Abstract: Customer order response time and system throughput capacity are key performance measures in warehouses. They depend strongly on the storage strategies deployed. One popular strategy is to split inventory into a bulk storage and a pick stock, or Forward-Reserve (FR) storage. Managers often use a rule of thumb: when the ratio m of average picks per replenishment is larger than a certain factor, it is beneficial to split inventory. However, research that systematically quantifies the benefits is lacking. We quantify the benefits analytically by developing response travel time models for FR storage in an Automated Storage/Retrieval system combined with order picking. We compare performance of FR storage with turnover class-based storage, and find when it pays off. Our findings illustrate that, in FR storage systems where forward and reserve stocks are stored in the same rack, FR storage usually pays off, as long as m is sufficiently larger than 1. The response time savings can go up to 50% when m is larger than 10. We validate these results using real data from a wholesale distributor. Date: 2020 Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:taf:uiiexx:v:52:y:2020:i:9:p:961-976 Ordering information: This journal article can be ordered from DOI: 10.1080/24725854.2019.1699979 Access Statistics for this article IISE Transactions is currently edited by Jianjun Shi More articles in IISE Transactions from Taylor & Francis Journals |
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