Warehouse capacity in a stochastic environment

In this study we examine the elements that affect the required capacity of a warehouse in a stochastic environment. The required capacity is measured in terms of its deviation from the nominal capacity requirement (NCR). A simulation model was developed to measure the relationship between warehouse capacity and the various pertinent parameters. From a set of simulated experiments, it is seen that the deviation in the required capacity is mainly affected by the number of items stored, the ordering quantity and the average issues of items per day.