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Fundamentals of Product Slotting

Fundamentals of Product Slotting

Historically most product slotting has taken place on an ad-hoc basis in most operations around the globe. The reason for most product slotting is the necessity to create new space or to rationalize old SKU’s. The traditional method of product slotting would essentially take the form of an ABC linear slot algorithm, where the number 1 SKU in the velocity sequence would be placed in slot number 1 in the pick sequence. Theoretically, this is a sound method. However, fundamentally it misses the uniqueness of the SKU’s and the rules surrounding various factors such as storage conditions, family groupings and product characteristics. Essentially you may be able to effectively slot 50-55% of your products in this strategy; however, this slotting strategy would leave a large number of exceptions and outliers in your
operating plan. Download our White paper.