Evaluation of order picking systems using simulation

Order picking activities play a critical role in supply chain management in terms of both production systems (supplying components to assembly operations) and distribution operations (meeting customer demands). Trends in customer orders reveal that orders are transformed from few-and-large orders to many-and-small ones. On the other hand, lead times of customer orders get consistently shorter. Because of these changes, companies need to adopt an effective and flexible order picking system in order to remain competitive in the market. Order picking affects both overall logistic operations and service level provided to customers. Additionally, order picking process constitutes more than half of the total warehousing cost. For these reasons, it is crucial for companies to design and perform an effective order picking process. The aim of this study is evaluating and improving of the order picking system so as to minimize the order retrieval time while increasing the picking efficiency. Order retrieval time can be defined as the time elapsed for the process of retrieving products from storage area to meet a specific customer demand. Besides the critical factors such as storage assignment decisions and routing methods, replenishment problem of the storage areas, which is rarely addressed in the previous studies, has been taken into consideration in this study. Replenishment of the empty storage locations has been conducted by using the (S, s) inventory policy. Thus, the order picking system was modeled as a dynamic system.A hypothetical distribution warehouse, based on the real life warehouse of a company specialized in production of fasteners, has been studied in order to improve the order picking performance. Alternative combinations of routing and storage policies have been developed. Moreover, different simulation models of the order picking process were constructed. In these models, proposed alternative storage and vrouting policies were operated. According to the simulation results, the storage policy and routing policy combination which provides the shortest order retrieval time is determined. Finally, using simulation results, some statistical analysis methods have been implemented.Keywords: Order picking, warehouse management, design of order picking system, order replenishment, (S, s) inventory policy.