MT437 Unit 4 Slotting Analysis Example

Busiest Parts First and at Waist Height: An MT437 Unit 4 Slotting Analysis of 1,440 Parts

[Student Name]

Purdue University Global

MT437: Strategic Warehouse Management

Unit 4 Slotting Analysis

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[Date]

Lookout Parts Supply's zone, parts and pick history are composite; tour lengths come from a simulation of 20,000 tours described below, and the sources cited are real.

The Zone

The zone holds 1,440 parts in twelve aisles of 120 locations each, five shelf levels high. Aisle 1 is nearest the packing station; aisle 12 is farthest. Each aisle is about 100 feet long, and pickers follow a serpentine route, entering each aisle they need from one end and leaving from the other.

Ranking by Pick Frequency

Parts are ranked by the number of order lines they generated over thirteen weeks, not by units shipped or dollar value, because each line is a trip to a location. Demand is very uneven. The top 10 percent of parts, 144 of them, drew 48.8 percent of the 312,000 lines. The top fifth drew 63.6 percent. The median part was picked about eight times a week, while the busiest, a ceramic brake pad set, was picked more than 300 times a week.

The Current Slotting

Parts are slotted today by vendor line code, so all of one vendor's brake parts sit together, then the next vendor's, regardless of how often each is picked. The effect is close to random placement with respect to pick frequency: fast movers are scattered across all twelve aisles and all five levels, and only about 40 percent of picks come from levels two and three, the golden zone between knee and shoulder height where picking is fastest.

The Proposed Slotting

The proposal fills aisles 1 and 2 with the 240 busiest parts, which carry 59.6 percent of lines. The next tiers fill aisles 3 to 6, and the slowest parts fill aisles 7 to 12. Within each aisle, the fastest parts take levels two and three; the slowest go to the bottom and top. The 240 busiest parts also get double-width locations, so each holds about twice the stock and needs replenishing half as often.

Two aisles now hold three of every five picks, so most tours never need to go past the third aisle.

Tour Length

Tour length was estimated by simulating 20,000 tours of ten zone lines each, a typical share of a store order. Under current slotting, each line falls in any aisle with equal chance, so a tour visits about seven aisles and often reaches the far end of the zone; the average tour is about 955 feet. Under the proposed slotting, about six of ten lines fall in aisles 1 and 2, so tours visit fewer aisles and turn back sooner; the average tour falls to about 767 feet, a cut of about 20 percent.

Across 182 tours a night, that saves about 34,300 feet of walking, about 3.3 picker hours a night at 175 feet a minute, roughly 980 hours a year. At $24.10 an hour loaded, that is about $23,600 a year. Petersen and Aase (2004) found that class-based storage of this kind, combined with a sensible route, gives most of the travel saving available from storage policy, and the simulation is consistent with that.

Golden-Zone Share

With the fastest parts at levels two and three in every aisle, the share of picks taken from the golden zone rises from about 40 percent to about 78 percent. Fewer picks from the floor and top shelf mean less bending and reaching, which speeds each pick and lowers the risk of strain injuries.

Replenishment Trips

Replenishment trips fall because the busiest parts have larger locations. The top 240 parts average about 75 units a week each. In today's single locations, holding about 60 units, they need about 300 replenishment trips a week; in double-width locations, about 150. The other 1,200 parts need about 120 trips a week either way. Total trips fall from about 420 to about 270 a week, about 36 percent.

Why Rank by Lines, Not Units

A part shipped in cases of twenty may move many units while being picked rarely, and a part shipped singly may be picked constantly. Since each pick is a trip to a location, the walking a slotting plan saves depends on how often a location is visited, not how many units leave it. Ranking by units would have placed several bulk-pack parts in the fast aisles where they would save little walking, and pushed out small parts that are picked one at a time all night.

Cost of the Change

Re-slotting means physically moving 1,440 parts and updating their locations in the warehouse system, about 6 minutes a part, about 144 hours, or about $3,500 of labor, plus about $1,500 for new labels. It would be done over two weekends.

Keeping the Slotting Current

Pick frequency changes with the seasons, as batteries surge in winter and wipers in spring. The ranking should be rerun each quarter and the busiest parts moved only when they change tiers. De Koster et al. (2007) note that storage assignment loses its value as demand drifts, and Frazelle (2016) recommends a regular re-slotting schedule rather than a one-time project.

Recommendation

Re-slot the zone by pick frequency over two weekends, give the busiest 240 parts double-width locations at waist height and rerun the ranking each quarter.

References

De Koster, R., Le-Duc, T., & Roodbergen, K. J. (2007). Design and control of warehouse order picking: A literature review. European Journal of Operational Research, 182(2), 481-501. https://doi.org/10.1016/j.ejor.2006.07.009

Frazelle, E. H. (2016). World-class warehousing and material handling (2nd ed.). McGraw-Hill Education.

Petersen, C. G., & Aase, G. (2004). A comparison of picking, storage, and routing policies in manual order picking. International Journal of Production Economics, 92(1), 11-19. https://doi.org/10.1016/j.ijpe.2003.09.006