Solving shelf-space allocation problem as an extension of knapsack problem

Shelf-space is one of the most important resources for a retail firm. A shelf-space allocation problem is somewhat like a knapsack problem in the area of integer programming. This paper presents a SSAP model that can be solved by an approach that is similar to the algorithm for solving a knapsack problem. The proposed algorithm uses a heuristic of allocating shelf-space item by item in a descending order of each item's sales profit per display area or length and then makes necessary adjustments according to the given constraints. With numerical examples illustrated, the computational efficiency and the performance improvement of this method are also revealed and discussed.