Simulation-Based Evaluation of Order Picking Systems with Integrated Inventory Replenishment

Order picking activities play a critical role in supply chain management by providing components for assembly operations in production systems and ensuring the fulfillment of customer demands in distribution systems. Trends in customer behavior indicate a shift from fewer, larger orders to a greater number of smaller orders, while order lead times continue to decrease. To remain competitive, companies must implement efficient order picking systems that can adapt to changing conditions. This study examines the distribution warehouse of a fastener manufacturing company, with the aim of improving order picking performance. In addition to addressing key factors such as storage assignment and routing methods, the study also explores the often-overlooked inventory replenishment process within storage areas. A simulation model was developed to account for probabilistic demand and order picking frequency. Alternative combinations of storage assignment and routing strategies for the order picking process were evaluated under the (s, S) inventory policy. The experimental results identify the optimal combination of operating policies that minimizes order picking time.