A Complete Guide On How To Utilize Warehouse Space In Houston
Measuring the Utilization of Your Houston Warehouse Space
Is your warehouse space being utilized correctly? Many warehouse managers in Houston say that not having enough space in their warehouses is their biggest problem. But, the reality is, these managers simply are not utilizing their areas properly.
Did you know that in many warehouse spaces, only 20 percent of the area is being used at any given time? In fact, some warehouses even have higher utilization rates, which means increased costs, all due to the negative impacts of high utilization on the productivity of employees.
This Is How You Calculate the Utilization of Warehouse Space
Determining the utilization of your warehouse space is simple. Begin with calculating the total size of your entire warehouse. Your next step is to subtract the space used for offices, restrooms, etc. Let’s look at an example. Your warehouse space is 70,000 square feet. Of that space, 5,000 square feet is used for office space. That leaves 65,000 square feet for usable warehouse space.
Your third step is to determine the cubic feet of your space. Therefore, expanding on the above example, take the 65,000 square feet and multiply it by the clear height of the warehouse space. So if your clear height is 25 feet, for example, then the cube size or storage capacity will be 1,625,000 cubic feet.
Your fourth step is to determine your inventory cube size. So, add up the volume of all the products you’re storing in the warehouse and divide by the cube size. Continuing to expand on the example, let’s assume you have 250,000 feet of products in your warehouse. Dividing it by the 1,625,000 cube size would bring you to 15.38 percent utilization. This is a healthy use of space.
This is How You Calculate Your Warehouse Storage Cube Size
As we stated above, 15.38 percent utilization is healthy, but why? Let’s take a step back and determine the warehouse storage cube size. First, you’ll need to measure the pallet rack’s footprints and then calculate their full vertical storage capacity. Second, multiply the actual capacity of each of the racks by the complete amount of racks in the warehouse. The result will be the size of the storage cube.
You will find that warehouse space storage cubes are typically between 22 percent and 27 percent of the storage capacities. If you had a 1,625,000 cubic foot warehouse, it would be normal to have a storage cube of 357,500 and 438,750.
What happens if your storage cube size it outside of the 22 percent to 27 percent range? It could mean a possible problem in the space layout or design of your warehouse.
So if you find you have a larger storage cube size, you can have the potential of high labor costs. This is because your employees will have less room to move about the warehouse for picking and restocking. If you find you have a smaller storage cube size, you may be wasting space with racks that are not located efficiently.
When you compare the cube size of your warehouse to the inventory cube size, a lower number emerges that shows how the space and design of your warehouse are being used. When you design your warehouse with the goal of optimization, and you calculate how your storage cube is being used by dividing it into the inventory cube, you’ll get a better look at your efficiency.
Let’s look at the midpoint of the example of the storage cube above. If your warehouse has 398,125 storage cube, storing products in 250,000 cubic feet would result in 62.79 percent utilization of the available storage space.