Layout design modelling for a real world just-in-time warehouse

- Just-in-time warehouse layout design by mathematical programming.
- Travel distance minimization by store allocation within the layout.
- Minmax approach for store allocation to clusters of floor locations.
- Portuguese retail sector case study with more than 200 floor locations' layout.
- Case Study results suggest potential 2000 km/month distance travelled reduction.

The retail industry sector is one of the most competitive and where each company has to improve their operations on a daily basis to remain competitive. The struggle to move to just-in-time delivery requires distribution centres to readapt to this reality. Most of the literature in warehouse layout design is focused in traditional warehouses, where the main focus is on product storage and picking. However, when operating in a cross-docking basis, new approaches are required to plan the internal layout of the warehouse. In this paper, it is proposed a mathematical programming approach, based on a min-max formulation that returns the optimized layout of a cross-docking warehouse that feeds a just-in-time distribution operation. In this case, the layout requires the allocation of floor spaces to stores' demands. Products are picked up at the receiving dock, and are transported by the worker along the warehouse up to the location where the products for a given store are located. Then, the products are left in the required quantity and the worker moves to the next store location that requires that product. To this end, we perform clusters of floor locations that may be used as locations to visit in product distribution routes. Our approach was tested in a real world case study of a Portuguese retail chain in a fruits and vegetables warehouse, which supplies more than 200 stores per day. We show that the distance travelled in the warehouse can be reduced in more than 2000 km/month by just reallocating stores to different floor locations.