Facility Layout Design of New Warehouse and Implementation of Multi-Criteria Decision Making for Product Allocation at PT XYZ

Abstract

As the company's business grows, its product distribution network will increase. This will cause distribution costs to be increased. Therefore, the company decided to build a new warehouse to increase the efficiency of distribution costs. This new warehouse will use two storage systems, which are racking system and floor storage, so it needs to design a good layout so that the space provided can be used effectively and efficiently. A dedicated storage policy is used to make workers easier to find products so that the time of product retrieval is faster. Another thing to consider is the proper allocation of products because this can affect the total distance of product movement which can also affect the time of product retrieval. In this study, multi-criteria decision making (MCDM) will be used to determine which product will be the main priority to be placed near the inbound/outbound (I/O). The MCDM method that be used is the weighted product where the use of this method considers several criteria such as demand, weight, and storage capacity. Furthermore, several alternative storage layout designs were made by considering the total displacement distance, land area, and even distribution of aisle usage. After that, the supporting facilities needed for warehousing activities from receiving to shipping the product are arranged using activity relationship chart (ARC).