Intelligent product placement strategies for Amazon.com's worldwide fulfillment centers

Online retail has radically changed traditional supply chain operations by providing a direct-to-consumer model that eliminates the need for traditional brick-and-mortar retail stores. With this new order, retailers have had to design warehouse solutions that fit the changing operational requirements of online retail. Over the last several years, Amazon.com has become a market leader, capturing almost 8% of all online retail sales in 2005. As Amazon grows in size and scope it is faced with unique challenges in warehouse system design and strategy. A significant portion of Amazon's total fulfillment cost is in the "picking" process which is where associates pick items to fulfill customer orders. Picking costs are directly influenced by the upstream stowing process which determines where to physically store Amazon's retail items. Currently, Amazon's fulfillment centers stow inventory according to "profiling" rules which direct inventory to various locations in the warehouse in order to optimize the space utilization of the facility. However, these profiling rules do not account for the impact of the stowing decisions on the cost to pick and replenish products downstream.

Department dc:contributor.department

Leaders for Manufacturing Program at MIT

Grantor dc:publisher

Massachusetts Institute of Technology

Year dc:date.issued

2006

Author dc:creator

• Rubenstein, Linsey (Linsey Jill)

Advisor dc:contributor.advisor

• Stanley Gershwin and Jeremie Gallien.

• Sloan School of Management.
• Engineering Systems Division.
• Leaders for Manufacturing Program.

Statement dc:rights

• M.I.T. theses are protected by copyright. They may be viewed from this source for any purpose, but reproduction or distribution in any format is prohibited without written permission. See provided URL for inquiries about permission.

Licence dc:rights.uri

• http://dspace.mit.edu/handle/1721.1/7582

Language dc:language.iso

eng

Handle dc:identifier.uri

http://hdl.handle.net/1721.1/37246

OAI identifier oai:identifier

oai:dspace.mit.edu:1721.1/37246