Data processing: financial – business practice – management – or co – Automated electrical financial or business practice or... – Inventory management
Reexamination Certificate
2000-05-10
2003-09-16
Chilcot, Jr., Richard E. (Department: 3627)
Data processing: financial, business practice, management, or co
Automated electrical financial or business practice or...
Inventory management
C705S022000
Reexamination Certificate
active
06622127
ABSTRACT:
BACKGROUND OF THE INVENTION
This invention pertains to fulfilling customer orders from inventory that has already been stocked within a distribution center. More specifically, this invention pertains to fulfilling order lines by choosing order items from inventory locations holding relatively few units of the items.
Distribution centers are buildings or regions where inventory is stored and used to fulfill orders for customers. Customers place orders by various modes such as by telephone, mail, Internet browsers, and the like. To run a distribution center economically, at least three overarching concerns must be addressed: (1) minimizing carrying costs per unit of inventory, (2) minimizing spoilage, and (3) maximizing throughput.
Carrying costs may be viewed as the “overhead” associated with each unit of inventory that moves through the distribution center. Such overhead includes the cost of real estate, the cost of special ambiences such as refrigeration, etc. To minimize carrying costs per unit of inventory, the distribution center should maximize the productive use of its space. To the extent possible, all inventory locations should be fully stocked with rapidly moving items. Obviously, some items in the distribution center move much faster than other items. In order to attract customers, an organiization's distribution center must stock a wide variety of items, including those that move fast as well as those that do not move so fast. Ideally, inventory locations are correctly biased in favor of rapidly moving items.
A distribution center's “throughput” is defined as the volume of inventory or number of orders fulfilled in a given unit of time. At least two parameters feature prominently in maximizing throughput: (a) useable inventory and (b) load balancing during order fulfillment. Usable inventory simply refers to the amount of inventory that is immediately available for order fulfillment. Obviously, if a distribution center has insufficient inventory to immediately fulfill all its orders, that distribution center cannot realize its potentially highest throughput. Load balancing refers to consistently using all order fulfillment mechanisms available for fulfilling orders. If any of these mechanisms sit idle, throughput drops off rapidly.
A given distribution center may have many order fulfillment mechanisms. In one example, the distribution center includes a conveyor that transports a container to various locations, each of which has an order fulfillment mechanism. One location may have a bank of carousels, each containing numerous bins that stock inventory. Each bin holds one or more types of inventory. When a container arrives at a carousel, it rotates its inventory into a position where order items can be placed in the container. Another order fulfillment mechanism in the distribution center may have a few aisles each containing multiple bins. A worker moves through the aisles to pick out requested items and place them in the container. Other types of order fulfillment mechanisms may be employed. A “pod” is a group of inventory locations all serviced from the same stop on the transport system (e.g., a conveyor stop). A pod may contain any or more of the various types of order fulfillment mechanism. Each pod has one or more types of inventory available for “picking.” Picking refers to the operation of retrieving an item of inventory from a pod and placing it into a container. The container holds the various items that fulfill a given order.
Given that different customers have very different needs and preferences, different orders provide wide and rather unpredictable variation. Optimal load balancing to meet this variation presents a serious challenge. During a given week, for example, several grocery orders may require milk, but only a few of these require anchovies, a few others require spicy tofu, and still a few others require cotton swabs. Rapidly fulfilling all such orders in a manner that reduces carrying costs per unit inventory presents a special challenge.
The present invention fills a need for better ways to fulfill customer orders within a distribution center.
SUMMARY OF THE INVENTION
This invention provides a method and associated warehouse management system that maximizes throughput and reduces carrying costs by reducing the number of stops that a container makes in the process of fulfilling a customer order. This is accomplished by allocating inventory to orders using the following series of considerations. First, the system selects a pod in order to maximize throughput. If there are multiple locations within the pod that stock the same inventory item, then the method chooses one of those locations based upon the expiration date. Finally, if a subset of these locations have units that expire within the same expiration period (the soonest expiration period), the method chooses the location with the fewest units. In this manner, those inventory locations having the most idle space are rapidly cleared to make more complete use of the available space.
One aspect of this invention provides a method of filling a customer order in a distribution center having a plurality of pods. Each pod has multiple inventory locations for stocking a plurality of items. The method may be characterized by the following sequence: (a) choosing at least one pod based upon a throughput analysis to provide items necessary to fulfill the customer order; (b) identifying a replicated item from the customer order; and (c) choosing to fill the customer order with units of the replicated item stocked in a second inventory location. In this aspect, the replicated item is stocked in at least two inventory locations in the first pod: a first inventory location having a first number of units of the replicated item and a second inventory location having a second number of units of the replicated item. The first number of units is greater than the second number of units. Thus, the method chooses items from the location having the smaller number of stocked units.
Preferably, the throughput analysis of (a) analyzes at least one of the following parameters: (i) a number of pods that a container must stop at when receiving items to fill the customer order and (ii) balancing pick loads of various pods within the distribution center. Regarding the number of pods that the container must stop at, the method should choose pods that contain large numbers of items from the order so that many order items can be placed in the container in a single stop. With this in mind, the first pod should be chosen because it contains, in comparison to other pods in the distribution center, the most items of the customer order.
In some cases, the expiration time (date) of an item may override the unit count in a location. To this end, the method may also identify an expiry item from the customer order, which expiry item is replicated in an early storage location within the first pod and a later storage location within the first pod. Units of the expiry item in the early storage location expires sooner than units of the expiry item in the later storage location. In this scenario, the method chooses to fill the customer order with expiry item units from the first storage location. Not always will the method choose the earlier expiring units. It may first determine that the expiration point of the units in the early storage location is not earlier than a cutoff time (e.g., the item will expire within 2 days or less after delivery to the customer), after which the units cannot be used to fulfill the customer order. When the expiration time of units of a replicated item from two or more locations fall within the same “expiration window” (say within 1 to 3 days of one another), then the method chooses the location stocking the fewest units.
Another aspect of the invention pertains to a distribution center having inventory arranged for filling customer orders. The distribution center may be characterized by the following features: (a) at least one ambient having a plurality of pods; and (b) a warehouse management sy
Grewell Patricia C.
Griese Susan L.
Ham Peter
Klots Boris
Perham Gerry
Beyer Weaver & Thomas LLP
Chilcot Jr. Richard E.
Jaketic Bryan
Kaiser Foundation Hospitals
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