Maximize Warehouse Space With Warehouse Layout and Design

Space within the four walls of the warehouse is at a premium, so it is critical to maximize all available warehouse space while ensuring orders can be fulfilled quickly. Identifying the most effective slotting patterns and the best storage solutions optimizes warehouse space and makes it easier to get products out the door faster.

An important service provided by Penske Logistics is slotting analysis.

Smart Warehouse Slotting

The slotting analysis starts by identifying volumes and establishing which SKUs (products) move more or less quickly. These are categorized as A, B, or C movers. A-level inventory moves the fastest, B-level inventory moves more slowly, and C-level inventory moves very slowly. There may also be D-level items that do not move and are considered deadstock. A-level items are positioned closer to the dock to minimize travel time, enabling faster picking and shipping. Slower-moving products are stored further from the dock or, if racking is available, in higher locations. This arrangement makes it easier to put products away and more efficient to pick the product when needed.

Engineers review inventory movement over time, such as multiple years, and look for seasonality and how many times a SKU moves daily, weekly, etc. You may have 20 to 30% of SKUs that are A-level with B-level close behind.

Engineers will establish rules within the warehouse management system (WMS) to show how needs might change. SKUs that move every day or every week are categorized as A items and are represented in planograms as green. Items marked in red may move only once a month and do not require prime locations. Over time, this system allows for regular review of green, yellow, and red indicators, enabling fast movers to be placed in locations where they can be picked more efficiently.

The Impact of E-commerce

The growth in e-commerce creates more and more warehouses with three fulfillment channels — their locations, outside retail locations and business-to-consumer. Depending on order volume and the method of receiving orders, it may be necessary to design separate areas for pallets, case picking, and each picking.

If your business supports e-commerce, well-run warehousing is a critical component of any omnichannel strategy. The way product is stored and dispatched is fundamental to the efficient operation of supply chains that span multiple buying channels.

Storage Strategies to Maximize Warehouse Space

Penske Logistics also helps shippers determine the best storage solutions, which are often based on cost. Warehouse space prices may vary by region. For example, warehouse space may be significantly more expensive in California than in the Midwest. In some cases, it is more cost-effective to use vertical space rather than find additional square footage in a specific warehouse.

With floor storage, a standard aisle width could be 12 to 14 feet between the products so forklifts can move effectively. That can drop down to 8 to 10 feet if a reach truck is used. Very narrow aisles (VNA), which are about six feet wide, require a wire-guided solution. This involves installing wires in the floor at the center of each aisle and equipping the material handling equipment (MHE) with wire guidance. This setup allows the MHE to move safely in a straight line without colliding with the racking.

Standard select racking utilizes the warehouse's vertical space. Options such as single-deep racking, double-deep racking, push-back racking or drive-in racking can be designed and installed to add additional storage locations in the warehouse.

However, installing racking increases costs. For short-term storage needs, installing racking may not be practical, while for longer-term storage requirements, evaluating the cost of racking versus floor storage through a return on investment (ROI) analysis can help determine the best option.

Review and Adjust

Adjusting slotting patterns as demands change is generally straightforward. These adjustments should be made at least once a year to maintain efficiency. In certain industries, such as food and beverage, slotting patterns are updated seasonally. For example, strawberries are sold only during specific times of the year, so a section of the warehouse is set aside to store them, enabling more efficient put-away and picking during peak periods.

The engineering involved in re-slotting a warehouse is uncomplicated, but physically moving the product requires effort. One common practice is to 'bleed off' locations—allowing current product to be depleted from a location so it can be opened up for new inventory.

An ever-changing economic and technological environment make it more important than ever to maximize space and reduce cost. Penske Logistics has the experience and expertise to help.