The impact of routing and storage policies on warehouse efficiency

Order picking, the activity by which a number of goods are retrieved from a warehousing system to satisfy a number of customer orders, is an essential link in the supply chain and is the major cost component of warehousing. The critical issue is to simultaneously reduce the cost and increase the speed of the order picking activity. The main objectives of this paper are: evaluate various routing heuristics and an optimal routing in a volume-based and random storage environment; compare the performance of volume-based storage to random storage; and examine the impact of travel speed and picking rates on routing and storage policy performance. The experimental results show the solution gap between routing heuristics and optimal routing is highly dependent on the travel speed and picking rate, the storage policy, and the size of the pick list. In addition, volume-based storage produced significant savings over random storage, but again these savings are dependent on the travel speed and picking rate.