Multi-Criteria Approach for Inventory Classification and Effective Warehouse Management

Abstract

Organisations classically employ the ABC analysis to have efficient control on the inventory items and for effective management of warehouses. This method usually considers sales values and usage volume of inventory items. In our study, in order to take into account more than one criterion, the PROMETHEE method, which is one of the pairwise comparisons MCDM methods, was used. For the inventory classification, five criteria have been identified that affect the storage activities for all products in order to determine the importance of the product types and product models which are produced by the company. Products were ranked according to their priorities using the PROMETHEE method. The results of the classification were used to assign the shelves to products in the storage. In this process, the top products are assigned to the closer places to minimise the transport distance. As a result of the inventory classification and storage layout plan, the usage rate of storage area has been increased and a layout plan which minimises transportation distances has been established. In this way, order picking and order shipment processes have been accelerated, and a more systematic approach has been created for warehouse management of the company. © © 2023 Inderscience Enterprises Ltd.