For warehouses and distribution centers space is money.  But over-crowded storage has a direct impact on efficiency, safety and ultimately productivity.  While it would be nice to just add space, this isn’t always feasible.  Fortunately there are steps that can be taken to improve capacity and productivity within your current floor space allotment. Here’s the first 5:

Improve Forecasting to Reduce Inventory
Look at the volume of inventory stored in the warehouse.  Often overstocking is the result of inaccurate forecasting.  With improved forecasting and tracking you can maintain proper inventory levels.  This will improve the utilization of precious warehouse space and while lowering storage costs.

Outsourcing
Consider Just-in-Time (JIT) outsourcing.  JIT delivery is widely used to free-up space and reduce inventory costs.  One Texas fabricator, for example, is saving $100,000 each quarter simply by stocking only standard material while relying on JIT delivery for jobs requiring special material.  Warehouse and distribution centers can leverage JIT principles by stocking SKUs off-site allocating storage and shipping to a third-party vendor.

Effectively Slot the Warehouse
Perform a slotting analysis of all storage areas to determine optimum storage size and location for each item. This will reduce storage space as well as improve throughput. Reevaluate as business needs change.

Use Appropriate Storage Equipment
Analyze inventory levels, picking frequency, and storage capacity for each product to determine storage requirements in both active and reserve locations. You can then install the right equipment and configure accordingly to optimize storage space.

Get Vertical
When feasible, use empty vertical space for storage to reduce space requirements. For warehouses with sufficient dimensions, use AS/RS equipment which can pick up and deliver product up to 100 feet high.