A good warehouse layout can streamline your workflow and create faster shipping times. However, if you aren’t warehouse efficiently utilizing the space that’s provided, it can negatively affect your supply chain, workflow and shipping times.

Whether you have a new warehouse or are currently running one, there will be a time where you have to redesign the layout to optimize efficiency. Although there is no one-size-fits-all approach to laying out a warehouse, there are some tips you can use to optimize your warehouse for maximum efficiency and revenue.

Check out all 12 tips on improving your warehouse layout, or jump straight to the infographic for a summarized version.

4 Tips for Designing Your Warehouse Layout

Setting up a new layout is a massive undertaking, and no matter what, the best way to implement a redesign of your warehouse is to have a game plan. It can be challenging to know what to do and where to plan first, but there are four distinct actions you can take to make everything easier.

1. Map it Out

The first thing you’ll want to do is design a map or blueprint of your warehouse. You can reference an existing map of your warehouse, or you can make a new one.

If you prefer, you can do this with a pen and paper. Another method is to use warehouse layout design software. Two of the big ones are Smartdraw, a free diagram software tool, and AutoCAD, a computer-aided design software.

You can also hire a warehouse design expert who can design an optimized layout based on your specifications and needs. Don’t take any shortcuts when it comes to measuring out your workspace. You want the most accurate measurements you can get.

No matter how you develop your new layout, make sure you label what the different areas are and the direction of the workflow, including walking paths and the flow of shipment and products.

Display and label your operation areas and include space measurements in your design, like the height of the building inside. Having that laid out and established can help you decide on the proposed changes.

Once you have your map set up, the next thing you’ll need to do is to optimize your space.

2. Plan for Space Optimization

The amount of space you have in your warehouse will determine your layout. You should consider storage, workflow areas and equipment for space use. However, you’ll want to plan your storage area first. Knowing the amount of space you have to store your products is crucial.

There are different methods to take when storing products and setting up workstations. One way is through the use of an organized cluster method, where products are grouped by type. Each cluster is easily accessible for all workers.

Another way is to set up your storage in aisles. It’s similar to the way a grocery store is designed, with the aisles in the back and production and workflow in the front.

If you plan accordingly, everything should fit in its place, but if something can’t, go back to the drawing board. Always make use of vertical space as stacking products will increase your storage capacity and maximize the amount of space that you have.

One recommendation is to calculate the amount of space you have and dedicate between 22-27 percent of that space to your total product storage capacity.

Note that technically, your warehouse is out of space when the storage area is at 85 percent capacity. This is why it’s important you optimize your space so that storage, workspace and the equipment you use aren’t on top of each other.

3. Pick the Right Equipment

No matter what your warehouse is used for, you need equipment for your operations. The type of equipment that’s available to you is vast, but you might be limited by the space you have. Different types of products require different material handling equipment, which will affect the spacing of your aisles: a forklift will need more space than a pallet jack.

Have your aisles be between 12-13 feet wide as most conventional forklifts require a minimum aisle width of 12 feet. This can change, however, depending on different factors, including the size of your warehouse and your product storage.

Forklift

One of the most popular and crucial types of equipment used for warehouse operations is the forklift. Warehouse forklifts are perfect for indoor work, transporting heavy and bulky items and pallets, helping workers transport items around the warehouse.

There will be times where it may be more economical to rent a warehouse forklift for your operations. Remember to also practice proper forklift safety practices — no one wants an injury on the job.

Pallet Jack

Another type of equipment you’ll need is the pallet jack. These are the most essential pieces of equipment in a warehouse. They’re used for transporting small loads across shorter distances, and they come in two varieties: manual and electric pallet jacks. Depending on your preference, either can work for your warehouse.

Although it may seem straightforward, you’ll want to make sure you know how to use a pallet jack. Safety should always be a priority in your warehouse, so proper training needs to be offered as well.

4. Test the Plan and Record the Results

Before you design or modify your warehouse, you’re going to want to run a test. The best way to do this is to measure the proposed layout and set up the perimeter, then walk through it. You won’t have to do this through all of the different sections, but you should test out the high zone areas.

Don’t forget to use the equipment while testing to make sure everything can move freely and unobtrusively. Have your employees test out the new design as well, as they’ll be the ones that work on the floor.

Record the results, writing down what works well and what may need changing. Be sure to alter your plans if anything doesn’t seem to work out. It’s best to work out all the kinks now so that any alterations can be made in the planning process.

3 Warehouse Layout Designs Suggestions

Optimizing your warehouse layout can drastically improve operations, but what may work for one warehouse may not work for yours. However, there are a few base design options that may very well work in your favor.

Here are the top three warehouse layout designs:

1. U-Shaped Design

A U-shaped layout is an excellent option for any sized warehouse due to its simple design that can be replicated almost anywhere. As the name suggests, the warehouse is set up in a “U” shape, like a semi-circle.

It’s recommended to put the loading and shipping areas next to each other. After that, put the reception area, also known as the staging area, behind loading and the picking area behind shipping.

Reception is where the unloaded product is separated and sorted before it’s placed in the appropriate place in storage. The storage area would fill out the back end of the warehouse with dynamic storage — or the most popular products if the warehouse — sandwiched between static storage — which are the products that are more inclined to sit on the shelves.

2. I-Shaped Design

Also known as a through-flow design, the I-shaped layout is great for high-volume warehouses. It’s set up in an “I” shape, with the loading and unloading area on one end and the shipping area on the other, with storage in the middle.

The products are arranged so that the higher-volume items are easily retrievable. However, products typically need to travel the full length of the warehouse to ship out.

3. L-Shaped Design

The L-shaped warehouse design sets up the traffic flow in the shape of an “L.” Loading and reception areas are positioned on one side of the building, and the shipping and picking areas are posted on the adjacent side. The rest of the space is filled with products, with plenty of space for storage.

5 Effective Warehouse Layout Design Tips

Although no two warehouses are going to be the same, some design tips are universal. All warehouses have loading and unloading areas, reception, storage, picking and dispatch/packing. The following are the most effective ways of utilizing the space you have for your warehouse.

1. Space Out the Loading and Unloading Area

The loading and unloading areas of a warehouse are either built into the building or are entirely separated from it.

If your warehouse has a built-in loading and unloading area, the access docking point will allow trucks to easily connect and unload their product directly inside the building. If there isn’t enough space for your equipment to move around in, everything will have to be done by hand, which will take longer.

If the area is independent of the warehouse, a two-step approach to the design needs to be implemented. You’ll need a forklift to shuttle the products from the trucks to the warehouse, where it will then be placed in the reception area.

2. Separate the Reception Area

The reception area, also known as the staging area of a warehouse, is where delivery is received, quality control is implemented and the sorting is done. It’s here where the sorting of the products begins.

You want to make this area separated from all the other areas of your warehouse. It’s easier to do this with an I or L-shaped design, but a U-shaped design can work just as well. If there isn’t enough room for all the items you receive, you can create a bottleneck right at the beginning of the unloading process.

Everything needs to be accurately checked and reviewed, which is why it’s essential to have it separated from the rest of the warehouse, and as big as you possibly can make it. Ample space needs to be provided here as it will allow for accurate product inspections and prevents bottlenecking.

3. Organize the Storage Area

One recommendation is to store vertically, but there are different methods of doing this. Stacking is a common way, but it should only be used on loads with great internal strength, like bags of soil, and for rigid packages like cardboard or plastic boxes. A racking shelf should be used for all other items.

Another way to utilize all your space for storage is to separate your dynamic and static storage. Dynamic storage is the section of your storage space that’s set up for popular items. Your static storage is made up of products that sit for a little before they are shipped out.

Differentiating between these two areas can help prevent inventory mistakes, such as having an inaccurate inventory. Johnson Controls, a fire safety product manufacturer, reported in a case study that optimizing their new warehouse storage area led to a 30 percent improvement of picking, or order finding and packing.

These kinds of improvements are essential to customer satisfaction, as it allows a quicker turnaround time.

4. Create a Separate Picking Area

Although not all warehouses will have a separate picking area, they are popular to use for shipping warehouses. They’re the areas where order preparation takes place.

The Amazon warehouses are possibly the best-known warehouses with picking areas. It’s recommended to place separate picking areas inside or next to the storage areas. Doing this reduces the amount of time looking for items.

Nevertheless, you can have an efficient picking area as well as Amazon’s by adding and using conveyors and sorters for an improved pick rate. For example, the Westernacher Consulting firm found that using conveyors drastically improved the pick rate from 60-80 picks an hour to 300.

5. Adjust the Shipping and Packing Area

The shipping and packing area is where all the packing and shipping preparation takes place before they are eventually shipped away. Keep this area obviously differentiated from the rest of the warehouse.

If there isn’t a dedicated picking area, that job can be done here. Likewise, if there is no need to pack the items in your warehouse, it’s good to have an area dedicated to placing items that need to be transported.

However, the best way to perfect your shipping area and shipping process is through proper warehouse storage optimization. Make sure to identify your most popular products and keep them near the shipping area, with the second most popular behind those, and so on. This is easier to do with a U-shaped and L-shaped layout.

There isn’t a single best way to set up a warehouse layout. However, following these tips can help make sure that your warehouse is optimized and running efficiently. Use these tips to help set up your new warehouse layout, but make sure you apply any necessary changes.

Your warehouse needs might be different from others, but make sure you have your needs met, such as having the right warehouse equipment and most efficient layout for your warehouse.