Track: Facilities Planning and Management

Abstract

This research addresses the multiple level warehouse layout problem, which involves assigning items to cells and levels with the objective of minimizing transportation costs. A monthly demand and an inventory requirement are associated with every item type along with vertical and horizontal unit transportation costs. The warehouse has one port to transport items vertically from ground floor to the other levels, where each item must be assigned to exactly one cell on the assigned level.

Both the items’ demand and their inventory requirements are stochastic, following a uniform distribution. This NP-complete problem is solved using an optimization-simulation-optimization approach. In particular, Ant Colony optimization (ACO) algorithm is modeled using discrete event simulation to capture the randomness of the items’ demand and inventory requirements, then the simulated ACO’s parameters are also optimized to guarantee superior solutions.

This approach’s performance is evaluated by comparing its solutions to the ones obtained using deterministic data. The results show that simulation was able to identify better assignments of items to cells than the deterministic approach, as the latter did not capture the real randomness of demand and inventory requirements.