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Assortment ABC classification problem at the warehouse modelled as a multi-knapsack

Czerniachowska Kateryna, Hernes Marcin, Subbotin Sergey

Zeszyty Naukowe. Organizacja i Zarządzanie / Politechnika Śląska

2023

z. 172

109--131

Purpose: Appropriate product categorisation in warehouses is an issue facing most warehouses and distribution centres around the globe today. The ABC classification scheme aids in determining the most vital values at the warehouse. ABC classification reduces the effects of excess, end-of-life, or huge volumes of phase-out products. Design/methodology/approach: ABC classification is a method for classifying products according to their relevance. Products are divided into three categories using the ABC analysis, with category “A” items being the most important, category “B” as medium important and category “C” items being the least important for the distributor. This research model the ABC classification problem as a multi-knapsack and provides an example of commercial and noncommercial solver usage that enables distributors to categorise assortment according to the ABC classification. Findings: Proposed approach enables the distributor to arrive at the best possible outcomes. Research limitations/implications: The main limitation of this research is that it does not take into consideration constraints that show that some products cannot be quickly categorised or placed on the shelves because of the availability of storage equipment or warehouse personnel at the time of classification should be considered. Further research may be done on these issues. Practical implications: Performance comparisons between the proposed approach and the traditional ABC classification method provided by the distributors are conducted. Originality/value: The main contribution is the improvement of the classification method used in warehouses these days. The proposed approach allows assigning an optimal product mix to ABC categories.