1. Can it ever be disadvantageous to pick a SKU from a forward-pick area? Explain in a paragraph.
2. SKU A is stored as pallets, with 20 cartons per pallet. Following table shows the orders received recently for SKU A. SKU A is allocated a single pallet location in the forward pick. Remaining pallets are stored in the reserve area and forward pick is restocked when number of cartons reach zero. (Hint: think about how full pallets should be picked and how less than pallets should be picked)
3. Consider a fast pick area where cases are picked from pallets (and all full-pallet picks are from reserve storage and may be ignored). Storing a SKU in the fast-pick area realizes a savings of 1.5 minute per pick; but each restock requires about 3 minutes. Because of volatility of purchasing, management is unable to specify a reasonable upper bound on how many pallets of each SKU may be expected in the warehouse. Which of the following SKUs has greatest claim to storage in the fast-pick area? Why? Show calculations to earn full credit
4. Consider four SKUs that are competing for space in a forward pick area. Each forward location holds a single pallet and will be restocked from bulk storage. Assume you forecast the following activity during the next planning period (where demands and minimum/maximum to be stored are measured in pallets). Assume that on average it requires 1 minute per pick from the ground level, 2 minutes from a higher level, and 3 minutes per restock.
5. Consider ten SKUs that are competing for space in a fast-pick area. Each forward location holds a single pallet and will be restocked from reserve storage. On average, it requires 0.5 minutes per pick from fast-pick area (for cartons and full pallets), 1.5 minutes per pick to pick a full pallet from reserve, and 2.5 minutes per restock to restock a pallet from reserve to fast pick area. Demand (carton & pallet) for each SKU during next planning period is given in the table below. Minimum number of locations required in forward area for each
SKU (li) and the upper bound of future inventory for each SKU (ui) is also given. Compute and rank all positive bids for forward pallet locations offered by the following SKUs. Use this ranking to auction off 50 pallet locations on the first level of single-deep pallet rack
