5.2.

Dedicated storage location policy

Dedicated storage, also referred to as fixed slot storage, involves the assignment of
specific storage locations or storage addresses for each product stored. Since a
storage location is assigned or dedicated to a specific product, the term dedicated
storage storage is used.
Two variations of dedicated storage are commonly used. Part number sequence
storage is often used due to its simplicity. The storage location of a product is based
solely on the part number assigned to it. Low part of numbers are assigned to the
best locations in the storage region; the higher the part number, the less
desirable is its location. Typically, part number assignments are made arbitrarily,
without regard activity, frequent trips will be made to very poor storage location.
Throughput-based dedicated storage is an alternative to part number sequence
storage. such a storage method involves a consideration of differences in activity
levels and storage requirements among product s to be storage. Throughput-based
dedicated storage is preferred to part number sequencing storage when there are
significant differences in either activity level or the inventory level products being
stored. Due to the increasing usage to throughput-based dedicated storage,
hereafter, we refer to it simply as dedicated storage.
5.2.1. space requirements
With dedicated storage, products are assigned to specific locations. Also, one and
only one product is assigned to a storage location. Hence the number of storage
location assigned to a product must be capable of satisfying the maximum storage
requirement for the product. With multiproduct storage, the storage space
requirements for each of the products.
Example 5.1
Consider a simplified representation of warehouse the stores four products: 1, 2, 3,
and 4. Daily demand and replenishment quantities for the four products are given in
the table 5.1. replenishment are staggered, with product 1 being replenishment on
days 1, 5, 9,; product 2 being replenished on days 3, 11, 19,; product 3 being
replenished on days 2, 8, 14,; and product 4 being replenished on days 6, 18, 30,
.
Due to assumed deterministic conditions and the repeating inventory cycles for the
four products, an aggregate cycle of 24 days will occur and repeat indefinitely as
long as no changes occur in either the demand rate of replenishment plan. Table 5.2
depicts the end-of period storage requirements for each of the four products.
Assuming that daily demands are met prior to storing the replenishments, the
storage requirements for the product are given by their replenishment quantities.

Hence the storage requirement for dedicated storage equal the sum of the
individual maxima, or 72 pallet loads.

5.2.2 sizing on the basis of service level

Once approach that can be used to size storage under dedicated storage conditions
is a service-level approach. Specifically, when demand for storage is a random
variable, storage capacity can be determined on the basis of the probability of a
storage of space. With dedicated storage, Qj storage slots are assigned to product j
for j =1,,n. therefore, the probability of there being a sufficient number of storage
positions for the product j is simply the probability of storage demand being less
than or equal to Qj. Thus, the probability is given by the cumulative distribution
function Fj(Qj).
If the storage demands for various products are statistically independent, the
probability of there being one or more shortages of storage space is given by
Pr (1 or more storages) = 1-Pr (no storages)