AN APPLICATION OF CLUSTER-ANALYSIS TO THE PROBLEM OF LOCATING ITEMS WITHIN A WAREHOUSE

The order picking function in a warehouse involves selection of items from storage areas in order to satisfy customer demand. It has been identified as the most costly warehouse operations activity. Cluster analysis identifies groups of items that are frequently ordered together. Items within a cluster may be located near one another, and efficient picking tours may, thus, be formed. We formulate the clustering problem as a p-median 0-1 integer program which may efficiently be solved to optimality.