Cost and Throughput Modeling of Manual and Automated Order Fulfillment Systems

Abstract

The e-commerce revolution has brought about the need for more efficient order fulfillment. Guidelines are needed to determine the order fulfillment system design, and whether a manual or automated system should be implemented. A spreadsheet-based descriptive model has been developed based on demand levels, labor rates, and order sizes. We propose to combine the descriptive model with simulation output to demonstrate reactions of the system to fluctuations in demand, labor rates, and order sizes. The ultimate research goal is to provide a design aid to companies engaged in order fulfillment systems, emphasizing the decision of whether or not to automate the sorting process.