Use of Association Rules Bases Storage Assignment Location for Improving Class-Based Warehouse Design: Case Study A Packaging Company

Abstract

The objective of this research is to improve the efficiency of a warehouse of a packaging company by re-assignment of storage location. As observed the company’s exiting problems, there is an issue on the inappropriate storage locations, causing problems of unnecessary travel distances and delays shipping as well as additional costs of overtime. To overcome this, the study formulated the problem as storage location re-assignment problems. The revised product placements and locations are applied a concept of association rules to find the relationships between items that be frequently ordered together and make them as the new product family, ranging from high-, medium-, and low movements. The proposed linear programming problem is solved by Fast-Mover-Closet-to-Door concepts with Open Solver in Microsoft Excel as the solver tool to find the optimal solution. The result shows that the new product location and layout can significantly help improving the warehouse efficiency in terms of decreasing picking distances by 30.40%, reducing the period of overtime hiring by 90.76% and reducing overtime costs by 50,982 baht a year approximately. Furthermore, it can improve the labor productivity of normal picking times up to 6.82%.