Using Warehouse Vertical Space to Improve Your Facility’s Profitability

In the warehousing industry, floor space directly translates to profits – more available square footage often means a more efficient and productive facility.

Many larger facilities also charge clients by the square foot, and the cost of storage is generally increasing across the market.  In 2013, average warehouse rent prices in the United States rose to an average of $4.75/sq. ft., according to a report from CoStar. That was an increase of 2.1% from the previous year, and some industry analysts report even higher average rents of $5/sq. ft. or more over the last few years.

These are significant numbers for warehouse management professionals, and optimal use of floor space means better overall profitability. Of course, finding floor space can be difficult, and for many facilities, there’s only one way to go – up.

Optimizing Vertical Space with Custom Warehouse Shelving

Vertical space is underutilized in most warehouses, but it's an essential factor to keep in mind when working towards a more efficient operation. Regardless of the age of your facility or the size of your workforce, you can optimize profits with custom warehouse shelving that takes advantage of every available inch.

Industry consultants recommend installing racks to fill 75–80% of the building's vertical space, setting aside the rest of the vertical space for safety; at least six inches should remain between the load and the next shelf. This ensures that lift truck forks and other material handling equipment can safely maneuver pallets for storage and order picking (and keeps the facility compliant).

While pallet racks are the most common type of storage infrastructure for modern warehouses, they are not always the most cost-effective option. Pallets take up about 10% of the average unit load, and limiting the use of pallets can be a simple way to add space. Wherever possible, switching to gravity flow racks can help optimize vertical efficiency. Depending on the needs of the stock keeping unit (SKU), bin racks or bar and sheet storage racks could be more suitable, and a blend of different types of shelving will offer the greatest flexibility with the smallest footprint. Shelving should be optimized to the facility for the best possible results.

Of course, managers need to be aware of load limits for each shelving units – along with the limits for relevant material handling equipment – and staying safe means following all OSHA and local regulations. With that being said, high-quality customized shelving is a dependable return on investment, as it offer a simple way to utilize more vertical space and work towards the recommended 75–80% mark.

Implementing Vertical Work Spaces with Warehouse Mezzazines

Many newer operations house workspaces and storage in the same building. With the rapid growth of demand for direct-to-consumer shipping driven by Internet retailers, filling orders on-site is commonplace; unfortunately, when floor space is simultaneously utilized by workers and pack stations, it isn’t generating storage revenue.

Warehouse mezzanines offer a simple solution. Mezzanines (adequately equipped with handrails, kickplates, bar grating and other safety essentials) effectively double the usable area over which they are built, and can be used for storage above work areas or provide floor space for additional work stations.

Looking at Vertical Space When Planning or Optimizing Your Facility

It's important to note that there are limits on the utilization of vertical space, and certain types of products carry specific requirements for shelving units. For example, operations that store hazardous materials or particularly heavy SKUs will probably not be able to build to the ceilings. However, even one additional level of shelving can increase overall storage capacity without adding to the unit’s footprint. Planning racks to match SKUs provides similar benefits to building higher, and some companies report vertical use gains of up to 50% just by replacing unneeded pallet racks.

When combined with well-planned channels of access and exceptional material handling equipment, the careful use of vertical space can help to make the most of any warehouse or distribution center. It's a simple but dependable way to increase efficiency.

References:

Hudock, Brian. "How to Maximize Warehouse Space When Expansion Isn't an Option." TompkinsInc. Tompkins International, 2015. Web. 10 Mar. 2015.

Occupational Safety & Health Administration. "Occupational Safety and Health Standards: Materials Handling and Storage: Handling materials &ndash General." OSHA. U.S. Department of Labor, Occupational Safety & Health Administration, n.d. Web. 10 Mar. 2015.

Trainor, Tim. "Warehouse Rent Growth 'As Good As It Gets' in Second Quarter." Costar. Costar Group, 31 Jul. 2013. Web. 10 Mar. 2015.