The Product Allocation Problem in a Warehouse with Compatibility and Volume Balancing Constraints

The organizations are interesting in adopting supply chain management
policies for reducing the total costs. In this context, the improvement of each specific activity plays a crucial role: for example, managing efficiently the storage space in a warehouse. It arises to a specific problem, known as Product Allocation Problem (PAP). PAP influences many performance measures of a warehouse (order-picking time and cost, productivity, inventory accuracy and etc.) and thus this problem has attracted the attention of many researchers, interested in developing efficient models and approaches. The traditional solution
strategy firstly groups the products in classes (considering their structure
and characteristics) and, then, assigns each class to a slot of the storage space.
In this work, we firstly present a mathematical model including both compatibility constraints (i.e., two classes could not be located in adjacent slots) and volume constraints for placing each class into the assigned slot. Since in realistic scenarios (many product classes and slots in the warehouse) the mathematical formulation could become computationally intractable, we also describe a two steps heuristic for solving the considered problem in a reasonable amount of time.