Similarity-based storage allocation rules in an order picking system: an application to the food service industry

Today's distribution warehouses often need to process a far higher volume of smaller orders of multiple products which considerably increases logistics costs. They use the so-called order picking (OP) systems where products have to be picked from a set of specific storage locations by an OP process usually driven by production batches or customer orders. The OP is often very labour-intensive and its efficiency largely depends on the distance the order pickers have to travel, which therefore needs to be minimised. Minimising this distance is affected by several factors e.g. facility layout, shape of storage area, and especially the storage assignment strategy. Products that are frequently ordered together in multi-item, less than unit load customer orders should be stored near each other: this is the correlated storage assignment strategy. This study develops, tests and compares a set of different storage allocation rules based on the application of original similarity coefficients and clustering techniques. Lastly, a case study demonstrates the effectiveness of the proposed rules in minimising logistic costs.