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Storage Location Systems

Storage Location Systems

  • Storage location strategies organise stock in a storage system, and have a considerable impact upon storage system performance. 
  • There are two main stock location systems: 
    • dedicated location (or fixed slot) storage system 
    • randomised location (or floating slot) storage system. 

Random Location Storage System 

  • This is a storage technique in which parts are placed in any space that is available (empty) when they arrive in the store room.  
  • This strategy places items in the closest available slot, bin or rack.   
  • Products are then retrieved on a first-in, first-out (FIFO) basis.  
  • This approach maximises space utilisation, although it requires longer travel times between order-picking locations.  
  • Randomised systems often employ a computerised automatic storage and retrieval systems (AS/RS), which minimises labour and handling costs.
  • Although this random method requires the use of a locator file to identify parts location, it often requires less storage space than the fixed location method. This location method is applicable where:
    • The stores system is computerised.
    • Fast moving items are stored.
    • There is need to maximise space usage. 
  • The random location storage method is typically preferred, because it provides a higher utilisation of empty locations.

Dedicated Location Storage System

  • This is a method of storage in which a relatively permanent location is assigned for the storage of each item in the store room or warehouse.  
  • This can simply be described as a stock location system where the same item is put in the same location every time.  
  • The system works on the principle: A Place for Everything and Everything in its Place.


      • Stores personnel will quickly and easily become familiar with the system because a pattern has been established
      • Items of a similar nature might be stored in close proximity.  This facilitates handling, security, health and safety
      • Items can be stores in such a way as to minimize handling & reduce pick time


    • It is improper for high demand items
    • More space is required thus long movements
  • The decision to use either fixed or random stock location systems depends on:
    • Type of goods stocked
    • Type of storage facility needed.
    • Throughput 
    • Size of orders

Other Storage Strategies


  • The popularity criterion locates popular items near the shipping area and the unpopular items always from the shipping.  By this method, the order pickers travel a shorter distance to pick the most popular items being ordered, thereby reducing the time required to pick orders.

Unit Size

  • The unit size criterion that small-size items be located near the shipping area and larger-size items be placed father away from the shipping area.  By locating smaller-size items near the shipping area, more items can be stored near the shipping area, which reduces the order picker travel distance and order-picking time.


  • The cube criterion is a variation of unit size in that the items with smaller total cube space requirements are located near the shipping area.


  • Compatibility refers to how well products may be stored together. For example, pharmaceuticals cannot be stored with bagged agricultural chemicals.


  • Complementarity refers to how often products are ordered together and therefore stored together. Computer disk drives, CD-ROMs, and monitors; pens and pencils; and desks and chairs are examples of complementarity products that usually stored close to each order.