5 ways to optimize your warehouse space

For many businesses that have outgrown their current warehouse or distribution facility, relocation or expansion may seem like the only options. However, these choices can be costly and lead to significant downtime during the transition process. Instead, it is often possible to store more in the space you already have by optimizing your warehouse, allowing you to grow your fulfillment operations and inventory without the expensive process of expanding your footprint.

Warehouse space utilization (WSU) is a key performance indicator (KPI) that measures the efficiency of your space usage. It is a tried-and-tested method for determining how optimized your warehouse is, allowing you to take steps to make improvements to your operations. In real-world environments, 100% utilization is impossible because warehouses need space for safety clearance (required open areas around such things as racks, equipment, electrical panels, fire exits, and fire-protection equipment), safe movement of employees and forklifts, and staging of goods for receiving and shipping. As a result, most experts agree that a WSU rate of around 80% is optimal.

Total Warehouse Space = maximum usable space, excluding aisles, safety features, and staging.

A warehouse has 80,000 square feet of available space, once space that is unsuitable for storage has been excluded, but it is only currently using 56,000 square feet of space for storage. Our calculation would, therefore, be:

This story was originally published by Supply Chain Quarterly. Read the full story at Supply Chain Quarterly →