In this thesis, an easily implementable stock location rule named DOI Rule is developed and examined over other rules. For this purpose, LP and QP formulations which consider the effect of the weights of each item and order picker are derived for single command and dual command cases, respectively. DOI Rule makes trade-off among the weight, order frequency and space requirement of each item. It is proved that DOI Rule results in an optimal layout in single command case. For dual command, DOI Rule gives a cost efficient layout and this assertion is illustrated by the Parwise Interchange procedure through simulation experiments.