Optimal Storage Locations for Warehouse Efficiency Improvement in a Haircare Manufacturer
Keywords:optimal storage location, warehouse improvement, storage location assignment, picking distance reduction
This study aimed to enhance efficiency of raw materials warehouse in a case study haircare manufacturer in Thailand though identifying the optimal storage locations for materials locating at this raw materials warehouse. At the same time, it was our goal to increase capacity and improve utilization at internal raw materials warehouse in order to store some finished products at this internal warehouse instead of storing all of them at external public warehouse. As a result, the case study company can save storage cost of finished products at the external public warehouse. The key methodologies used to improve current raw materials warehouse were removing obsolete materials from warehouse, regrouping materials according to types, sizes, and turnover rate, reallocating space for each group of materials, considering beam height adjustment, and reassigning locations for each group of materials using optimization model. The results showed that capacity of raw materials warehouse was enhanced by 12.65%, picking distance was reduced by 51.9% compared to current situation, utilization was more balanced throughout warehouse and annual cost saving of 874,800 THB was obtained from locating some finished products at the internal raw materials warehouse. In addition, robustness of the proposed model was analyzed and contingency plan was developed for handling with over flow materials if over utilization occurs.
Authors who publish with Engineering Journal agree to transfer all copyright rights in and to the above work to the Engineering Journal (EJ)'s Editorial Board so that EJ's Editorial Board shall have the right to publish the work for nonprofit use in any media or form. In return, authors retain: (1) all proprietary rights other than copyright; (2) re-use of all or part of the above paper in their other work; (3) right to reproduce or authorize others to reproduce the above paper for authors' personal use or for company use if the source and EJ's copyright notice is indicated, and if the reproduction is not made for the purpose of sale.