Implementation and utilization of a decentralized storage system : costing model

Abstract

Companies using just‐in‐time principles are currently moving from centralized to decentralized storage areas. A question that needs to be addressed is whether this move is cost efficient. Presents a costing model which can be used to determine if further consideration should be given to decentralized storage in a facility currently utilizing centralized storage. Evaluates whether the savings in material handling flow costs associated with moving from centralized to decentralized storage outweighs the additional costs associated with implementing and utilizing decentralized storage for a designated period of time. Through the process of solving the cost model, a new layout will be created for the decentralized storage system. The layout includes the placement of the additional material storage and receipt areas as well as the rearrangement of the other departments in the facility.

Citation

Sargent, T.A. and Kay, M.G. (1995), "Implementation and utilization of a decentralized storage system : costing model", International Journal of Operations & Production Management, Vol. 15 No. 9, pp. 210-219. https://doi.org/10.1108/EUM0000000003958