Warehousing in 2035

John J. BARTHOLDI III

Georgia Tech - Panama Logistics Innovation & Research Center

Georgia Institute of Technology

www.warehouse-science.com
Significant trends

• Science of warehousing

• Distributed automation
Port of Singapore, 1970 and 2010
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Law of Warehousing:
“Put the fastest-moving SKUs in the most
convenient locations.”

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Picks

Skus

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Picks

Skus

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Two fundamental warehouse resources

Space Time

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CUSTOMER ORDER
Order-line SKU Quantity Unit of Measure
1 ABC123 6 cases
2 DEF456 2 pieces

Time Space
Units of handling

Time efficient

Space efficient
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Space and time

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Trading space for time

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US

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Germany

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Singapore

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Singapore, US

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Central America

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Two beer distributors

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Which SKU should get the more convenient
locations in a FIFO warehouse?

Sku Rate of flow Average on-hand

A 100 pallets per week 500 pallets
B 10 pallets every other week 20 pallets

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Which SKU should get the more convenient
locations in a FIFO warehouse?

Sku Rate of flow Average on-hand

A 100 pallets per week 500 pallets
B 10 pallets every other week 20 pallets

Pallets of B spend less time in the warehouse

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Shared storage Dedicated storage

Ground floor
3 min per restock pallet 1 min per pick
positions

Overhead
pallet
positions

2 min per pick

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Which have strongest claim to forward space?

Case Demand Pallet Benefit per

SKU
picks (pallets) locations location

A 600 20 2

B 1,000 100 3

C 1,800 700 4

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Which have strongest claim to forward space?

Case Demand Pallet Benefit per

SKU
picks (pallets) locations location

A 600 20 2

B 1,000 100 3

C 1,800 700 4

forecast forecast
orders sales
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Which have strongest claim to forward space?

Case Demand Pallet Benefit per

SKU
picks (pallets) locations location

A 600 20 2

B 1,000 100 3

C 1,800 700 4

time space

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“Bang-for-the-buck”

Case Demand Pallet Benefit per

SKU
picks (pallets) locations location

A 600 20 2

(2 1) 600 (3) 20
= 270
2

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Bang-for-the-buck: reflects both time and space

Case Demand Pallet Benefit per

SKU
picks (pallets) locations location

A 600 20 2 270

(2 1) 600 (3) 20
= 270
2

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Bang-for-the-buck

Case Demand Pallet Benefit per

SKU
picks (pallets) locations location

A 600 20 2 270

B 1,000 100 3 233

C 1,800 700 4

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Bang-for-the-buck

Case Demand Pallet Benefit per

SKU
picks (pallets) locations location

A 600 20 2 270

B 1,000 100 3 233

C 1,800 700 4 -75

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 100
Minutes per location

100

200

300
100 200 300 400 500 600
SKUs
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 100
Minutes per location

100

200

300
100 200 300 400 500 600
SKUs
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What to do about Coke Classic?

(2 1) 1800 (3) 700

= 75
4

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Change the economics

(2 1) 1800 (3) 700

= 75
4

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Change the process

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How does the value of the forward pick area
change...

• After a marketing campaign to attract new customers?

• After a marketing campaign to convince current customers to consume

more?

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Summary

• Warehouse design should be based on

• The pattern of customer orders, and

• Local economics.

• Decisions should account for economics of both space and time.

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Distributed automation
Throughput

Capacity

Requirements

Time
 Storage
module
• More varied storage than
typical automation

• Robot travels slowly but brings

more SKUs
Convey, store, sort
Dense storage
Simulations courtesy of Kevin Gue
 Bulk

Reserve

Forward

Reserve

GridPick
 Bulk

Reserve

Forward

Reserve

GridPick
 Bulk

Reserve

Forward

Reserve

GridPick
Sort
¡Muchas gracias!