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The area of order picking has been widely studied but still there is no general approach covering all the potential variables of a unique case. Optimizing the product placement is a useful way to improve order picking through reduced travel distances and goes hand in hand with an appropriate batching strategy and routing policy. The existing methods are of mathematical basis and can be costly to implement and it is therefore necessary to develop a non-mathematical approach that can be used for distribution centers and in this particular case, the warehouse of a mail order company. Literature is reviewed to investigate the current situation of a large Swedish mail order retailer for the development of a unique product assignment strategy, taking into consideration potential variables. It was found out that a lot of trade-offs are being done all the time between travel distances of the SKUs. Also, it was found out that “cart blocking” might be a potential problem when using a turnover-based storage assignment strategy.

E-handelns omsättning har ökat kraftigt under de senaste åren, och det har satt ökade krav på lagerstyrning och lagerutrymme hos e-handelsföretag. Särskilt mindre e-handelsbolag har utmanats att skala upp verksamheten i takt med ökad försäljning och omsättning. Ett av dessa företag är Hobbyhem vilket säljer diverse artiklar inom hobby och pyssel. Företaget har behövt öka kapaciteten snabbt för att möta ökad efterfrågan vilket har lett till kortsiktiga best-practice lösningar och således en ohållbar struktur att bygga vidare på. En fallstudie på företaget visade att brister i strukturen, där smala gångar i kombination med inkonsekvent lagerhållning av produkter och slumpmässig artikelplacering på lagret gjorde plockrundor ineffektiva. Från en omfattande litteraturstudie togs relevant teori fram inom de identifierade problemområdena. Utifrån fallstudien och litteraturstudien genomfördes fyra simuleringar där fyra olika scenarion testades på fallstudieföretaget. Resultatet visar att det viktigaste är att bredda gångarna för att tillåta medtag av plockvagnen in i gångarna. Vidare visade simulering att den bästa metoden för tilldelning av artiklar till lagerplatser är en class-based storage vilken går ut på att de artiklar som säljer mest frekvent placeras närmast plockdepån. Det är även av stor vikt att hålla en konsekvent hyllstruktur på hela lagret för att utnyttja lagerytan maximalt.

Warehouse operations have become an important part of the retail industry today. For many companies in the retail industry, the profit margin can be as little as one cent for every dollar sold. Because of these extremely small profit margins, it is important that companies save as much in costs along the way as they can. One such way is to cut down on warehouse costs. In this paper, we shall study the costs of storing and retrieving products in a pick, pack and ship warehouse for an office supply company. In particular, we will examine possible ways to improve the flow of products into and out of reserve racking, by implementing different storage assignment policies. One way of finding the best possible storage assignments would be to formulate a cost equation along with constraints, and to minimize the cost using linear programming techniques. We shall study the Simplex Method, and we will use it to find optimal locations for a given set of storage tasks. However, the set of products to be stored and retrieved in our warehouse changes from day to day, and is subject to customer demand. Because there is no closed form solution or algorithm to find the optimal storage assignment policy under a random situation, we will use simulation techniques to study different storage assignment policies that could be applied in the warehouse. We will study the efficiency along with the maintenance requirements for each of the different policies and compare them with the current policy being used in the warehouse today.

A fundamental issue in warehouse operations is the storage location of the products it contains. Placing products intelligently within the system can allow for great reductions in order pick costs. This is essential because order picking is a major cost of warehouse operations. For example, a study by Drury conducted in the UK found that 63% of warehouse operating costs are due to order picking. When orders contain a single item, the COI rule of Heskett is an optimal storage policy. This is not true when orders contain multiple line items because no information is used about what products are ordered together. In this situation, products that are frequently ordered together should be stored together. This is the basis of the correlated storage assignment problem. Several previous researchers have considered how to form such clusters of products with an ultimate objective of minimizing travel time. In this dissertation, we focus on the alternate objective of minimizing multi-zone orders. We present a mathematical model and discuss properties of the problem. A Lagrangian relaxation solution approach is discussed. In addition, we both develop and adapt several heuristics from the literature to give upper bounds for the model. A cyclic exchange improvement method is also developed. This exponential size neighborhood can be efficiently searched in polynomial time. Even for poor initial solutions, this method finds solutions which outperform the best approaches from the literature. Different product sizes, stock splitting, and rewarehousing are problem features that our model can handle. The cyclic exchange algorithm is also modified to allow these operating modes. In particular, stock splitting is a difficult issue which most previous research in correlated storage ignores. All of our algorithms are implemented and tested on data from a functioning warehouse. For all data sets, the cyclic exchange algorithm outperforms COI, the standard industry approach, by an average of 15%.

The steel production is a highly capital and energy intensive industry that due to recent raw materials’ price increase and lowered demand, it has been squeezed and forced to look more deeply on how to add value to the customer at lower operative costs. The project was carried out on site at the ArcelorMittal’s millin Esch-Belval, Luxembourg which comprises an integrated melt shop, continuous casting plant and the rolling mill with the objectives of proposing optimization rules for the cold sector of the rolling mill and to analyze the impact of the future truckbay shipment area. The course of action followed was to draw a Value Stream Map (VSM) in order to understand the plants’ current status and serve as a roadmap to build a discrete event simulation model that after its validation, served as a support tool to analyze what-if scenarios. Similarly, a current status analysis of the  shipment/stock area was conducted collecting statistics about potential truckshipments and finally proposing a series of recommendations for its operation. The main proposed solutions to optimize the rolling mill’s cold sector were:(a) Integer programming model to globally optimize the scrap level when cutting the mother beams to customer size beams. (b) Updating pacemaker parameters and (c) Local process time improvements. Concerning the future truck loading, the simulation model was used as a support tool to dimension the transition area between the cranes’ and forklift operations resulting in a 6-9 bundles buffer capacity. Additionally, the current length-based storage policy was found to have competitive objectives so a turnover class-based storage policy is proposed with A, B, C classes which should provide an improved organization of the stock and travel distance of the cranes. The evaluation of the cranes’ performance remains an issue since there are currently no objective measures like, for instance, travelled distance. Optical measuring devices are suggested as one option to have a performance indicator that would help further investigate root cause problems in the shipping/stock area.

Food waste is a global concern due to its negative contribution to all aspects ofsustainability and organizations are looking for new ways to directly impact their own food waste and operate their business in a more sustainable way. Part ofthe food waste stems from warehouse activities where mishandling and poorly packed rolling storage containers (RSCs) lead to damaged items during transport. The storage assignment dictates how the items are ordered in awarehouse and is therefore responsible for how items are packed into RSCs. Due to the lack of previous research in this area, this thesis aims to investigate how the multi-criteria ABC-analysis can be used to optimize the storage assignment with the intent of minimizing food waste. A qualitative case study at Warehouse X was conducted where ten employees highlighted several criteria such as weight, volume, and similarity, that all need to be considered when optimizing the storage assignment. A total of nine criteria were used to generate eight classes that are used in the proposed multi-criteria ABC-analysis. The proposed model can be used by all actors in the Swedish food industry to improve their warehouse operations and operate them in a more sustainable way to reduce their food waste. It is also generalizable to warehouses outside the Swedish food industry

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