The Fragmented Warehouse: Location Assignment for Multi-Item Picking

Warehouse operations typically aggregate identical stock keeping units (SKU) into the same storage bin for easier bookkeeping and organizing of goods. With the emergence of automatic identification and tracking technologies like RFID, free-form storage of goods becomes a viable alternative. We consider the strategy of storing identical copies of an SKU in a fragmented manner and evaluate the operational characteristics that benefit from fragmented storage. Fragmented storage of identical SKUs creates a greater number of feasible pick- list opportunities -- with greater choice, greater optimization follows. We present an abstract warehouse model to evaluate the location assignment problem in warehouse systems. Specifically, we investigate picking operations that retrieve multiple items during a warehouse pass. We provide an analytical result for operations using a 'hybrid-cost' cost metric, and a brute force analysis for operations using the more common 'maximum-cost' picking metric. We show that fragmentation is more favorable when the number of copies picked for each SKU is small.