A simulation study of container size in two-card kanban systems

Setting container sizes is one of the first decisions that users of kanban systems must address. Yet researchers have largely assumed container sizes to be given. This paper investigates the effect of container size on average inventory and customer service levels in a two-card kanban system processing multiple part types. Container size and the number of kanbans are varied in tandem so that total in-process inventory capacity remains constant. Simulation results show that smaller containers lead to smaller average total inventories. The surprise is that smaller containers do not always lead to poorer average customer service. Smaller container sizes can lead to better average customer service when the costs of greater total setup time are offset by the benefits of more frequent material handling, that is less frequent station material starvation, and improved finished-goods part mix. This occurs primarily when container size is larger than average finished-goods order size and when setup times are relatively short.