Optimizing storage capacity of a warehouse is a delicate balance between using available space and managing productivity. Every square centimeter of surface area has a high value, therefore, any empty space in a plant equals waste. At the same time overloading a storage warehouse could complicate operational processes by limiting movement and cargo preparation area.

Several considerations must be taken into account when attempting to find the right balance between utilizing space and keeping space free for operations.

Data required for optimizing warehouse space

Storage space assessment:

  1. The total floor area of the warehouse
  2. The total shelf area space of the warehouse
  3. Total floor area available for operational use

Operational space requirements:

Make assessments of space requirements:

  1. For safe forklift movement
  2. For product staging
  3. For office space requirements
  4. For product redressing
  5.  if shipment staging and redressing occurs concurrently

Other concerns:

Other factors that can affect the storage concerns are listed below:

  • The type of shelving available in the warehouse. This will determine if all products can be put on shelves or if some products will always have to be stored on the floor
  • Whether the products are DG goods or not. The storage space available for DG products may be limited in some warehouses. Moreover, the warehouse will not be able to utilize 100% of capacity effectively if a large chunk of product has to go into a small space allocated for DG shipments (or vice versa). 
  • The number of SKUs. There may be limits to how many different SKUs can be stocked on a single shelf.
  • The throughput or cycle time for a particular SKU
  • The immovable assets affecting the layout of the warehouse.
  • Picking mode and requirements. If most picking is done using a forklift or pallet jack then space has to be catered for the movement of such equipment through the warehouse. 

The storage capacity of a warehouse is an important supply chain KPI. Warehouse optimization can also be further complicated as the company may have strategic plans to overhaul picking processes or to move into different types of warehouse management systems. Any decision to change processes or layouts has to also take into account future-proofing the warehouse to new technologies in the immediate future.

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