Storage management of items in two levels of availability

This paper is concerned with the problem of storage management of non-consumable items in two warehouses having different levels of availability. The items are used in a given process, which incurs a cost whenever the required item is not immediately available. We analyze the storage management problem in which items have non-equal size and prove that the problem is NP-Complete. We present two heuristic algorithms which are inspired by two integer programming formulations. The two heuristics are based on different approaches and provide insight that enhances our understanding of the problem. Our numerical study demonstrates that these heuristics perform very well, and therefore provide satisfactory solutions to the problem.