A decision model to enhance space utilization of a distribution center based on a performance-evaluated architecture

Distribution Center (DC) is one of the key warehousing elements in a supply chain. Given to-day's business focus on customer satisfaction, a DC's role of proper asset utilization such as product placement has a great impact on order fulfillment and thus can be regarded as a huge competitive advantage. This article analyzes the existing rack system of a medium-throughput DC and proposes a simulation model to improve its storage rack efficiency for product locating correspondingly. The study shows that the model is helpful in selecting the right location for the products by better utilizing the space of the DC so that the number of stock-outs can be reduced considerably.