Renovating or setting up a new warehouse space is a tall task. Planning out where equipment, materials, inventory, workstations, and even exterior vehicles should go can feel like you’re playing a game of Tetris with your warehouse.
But following some basic principles of efficient warehouse layout can guide you through this sometimes stressful design process. With a little forethought and the right tools, you can handily plan your facility’s layout to maximize its operational efficiency.
What is warehouse planning?
Warehouse planning is the process of designing a facility’s space with maximum efficiency in mind. The layout must account for the movement of materials, optimized equipment placement, and flow of traffic.
Once planners settle on a layout, they’ll finalize a comprehensive diagram detailing the design.
Why is warehouse design important?
Strategic warehouse design and layout offers a wealth of advantages for owners and managers. This meticulous approach to planning your facility and exterior space boasts a variety of benefits, both now and down the line.
Optimized space usage
If the facility owner didn’t consider layout when ramping up their warehouse, all that square footage probably isn’t being used as efficiently as possible. And wasted space leaves money and lost productivity on the table.
Strategically designing a warehouse layout helps owners and managers maximize every square inch based on their unique needs. Redesigning a space to work with your traffic patterns, workstations, storage, and equipment needs means you can streamline your processes at every stage to meet tight timelines and juggle increased demands.
For example, when you redesign a facility warehousing retail products, you can find extra space to increase the amount of inventory you can house at any given time. In addition, you can organize your inventory to make order picking and packing more efficient.
Regardless of whether you own or manage a distribution center, retail warehouse, or flex space, optimizing your warehouse layout makes it easier to manage and increases productivity.
The way equipment, inventory, and work areas are laid out can make or break productivity in a warehouse. When workers need to pick and pack inventory or handle materials and equipment, the way your space is designed matters. A thoughtfully organized space makes it easier to move through the facility and smooths out traffic flows between different workstations and departments. For example, a layout leaving enough room for designated and separated foot and vehicle traffic reduces safety incidents, which in turn drive productivity. As a result, workers can create more efficient workflows that lead to higher productivity.
Planning your layout can slash costs for warehouse operations in a variety of ways — from using less space to store your goods and equipment to better real-time inventory tracking.
Warehouse space is pricey — and every inch adds up. One study showed the average cost per square foot in 2023 was $13.50-$13.75. And when space is at a premium, it’s crucial to be as efficient as possible.
For example, a more strategic warehouse design can claw back the total square footage you need for inventory, which lowers leasing costs. When your facility is optimized, you can also fit more pieces of equipment or inventory in the same amount of space. So, the total cost of warehousing your goods decreases. Furthermore, planning the space to speedily handle vehicle traffic in loading docks reduces the waiting and waste of vehicles backing up. Just like a well-run port.
A well-planned space also cuts down on operational costs around picking, packing, and shrinkage. A well-designed space makes it easier for workers to pick and pack orders, which means they can finish more orders faster. And the right storage systems help you keep your inventory better organized — which curbs lost and stolen products.
5 key things to consider when designing a warehouse layout
Before diving into perfecting your warehouse design and layout, you’ll first need to consider a few crucial factors.
1. Available space
First, do some homework. Analyze your space to have a baseline understanding of what is feasible for your warehouse layout.
When assessing your space, you’ll need details like:
The building’s floor plan
Shape of the building (found in the floor plan)
Dimensions of usable space in the warehouse
Measurements of any separate storage areas
Any existing equipment
Any permanent fixtures in the building interior (think hot water tanks, existing washrooms, etc.)
The exterior loading areas, routes, and space for vehicle traffic.
Your goal is to collect all the crucial details about your warehouse to use every square inch to its fullest potential. Many of the measurements above will dictate parts of your warehouse design and layout. For example, the locations of the entrances and exits will determine where you can set up your shipping and receiving areas.
2. Aisle layout planning
Your aisles (and how they’re configured) are the beating heart of your warehouse. They’re also one of the factors that can determine whether your layout is a success or failure.
Your aisles are where you’ll store your inventory or materials. Whether you use shelves, racks, pallets, or some combination, ensure you organize your products in a way that makes it easy for workers to find the right goods and quickly move them to the next stage in the supply chain.
So, when choosing a warehouse layout, keep the number and configuration of aisles top of mind.
3. Number and type of products/materials processed
The volume and kind of goods that flow through your warehouse will also narrow down the most effective layout for your facility.
Let’s say your facility produces salsa. You’ll likely need cold storage capacity for perishable ingredients like tomatoes and bell peppers. You’ll need a separate area to store dry goods and other necessary items, like spices, jars, and labels.
On the other hand, if you’re an ecommerce company that sells non-perishable products with high product turnover, a layout with adequate shelf clearance for busy pickers plus plenty of packing stations for workers to fulfill customer orders will work best for your needs.
4. Order fulfillment
Your warehouse design alone can improve speed and efficiency when fulfilling your orders. Let’s say you sell a variety of kitchen gadgets and housewares and store your own inventory. You’ll need to set up your warehouse in a way that makes it simple to pick, pack, and ship your products out to customers.
In this scenario, you’ll need to work a few specific areas into your warehouse layout, including:
Receiving area. Where you’ll accept new products before they go onto your shelves or pallet racks. This station is typically located near the receiving dock.
Packing area. A dedicated station where workers pack products to send to customers. Here, you’ll need the station organized with plenty of tape, boxes, poly bags, and labels.
Staging area. Packed orders move from packing onto carts or conveyors to head to outbound shipping.
Effectively placed stations can make it faster for workers to prepare orders for shipping, which means they can fulfill more orders per shift.
5. Safety measures and worker well-being
Every warehouse will need to follow a number of required safety regulations, and some of these requirements will affect your layout.
Basic safety measures and equipment to have in your warehouse include:
Enough light for workers
Defined exit routes in case of emergencies
Designated locations for fire extinguishers
Ample space in aisles and loading docks
To learn more about required warehouse safety standards, check out the Occupational Safety and Health Administration (OSHA) website.
How to design a warehouse layout
Now that you know what factors to consider as part of your warehouse design and layout, it’s time to begin the planning process. Following these steps will guide you as you tackle renovating your warehouse or building your facility from the ground up.
Obtain a floor plan of your warehouse
As aforementioned, the layout of your building will heavily affect the kind of design that’s feasible for your space. To get a sense of what’s possible, either procure a copy of your building’s floor plans or create one from scratch.
A floor plan will give you a bird’s eye view of the building’s layout, plus the space’s dimensions and total square footage. This is the foundation upon which you’ll ultimately base your warehouse design.
In need of a floor plan? Matterport can help you capture all the details of your space with a digital twin. With a virtual version of your space, you can quickly generate schematic floor plans of your warehouse to visualize the layout, measurements, and flow. From there, you can use your schematic floor plan as a starting point for design and layout conversations.
Choose an optimal warehouse layout design
Although every warehouse owner and manager has unique needs for their layout, they often use the same starting point. Many warehouses are variations of one of four common layouts and are selected based on each one’s pros and cons.
The four common types of warehouse layouts include:
U shaped. Typically, one arm of the U-shaped warehouse serves as the shipping area while the other one receives incoming goods and materials. The rest of the space in between is for storage solutions and prepping products. The U shape is versatile and can work for warehouses of all sizes and support a fast flow of goods in and out. But it’s easier for shipping and receiving areas to have traffic jams on busier days if the U is too narrow.
L shaped. This layout separates the inbound and outbound goods on opposing ends of the L. Goods or materials can move in one direction across the warehouse, which busts up potential bottlenecks. This type is best for small- and medium-sized warehouses.
I shaped. Similar to the L in that shipping and receiving are on opposite sides of the warehouse. Again, this type means products can move from one end of the warehouse to the other without disruption, and the rectangle shape makes it easier to maximize the space. Great for organizations with a high volume of products going in and out.
Fishbone. In this configuration, the main aisle is the “spine” while diagonal aisles jutting out from there are the “ribs.” This can cut down travel time for workers picking products for orders thanks to the increased visibility of goods. But because this layout requires more space and investment, this works best for large warehouses.
Examples of U-, L-, and I-shaped warehouse layouts. Source
Example of a fishbone-shaped warehouse layout. Source
Create a warehouse floor plan
Once you’ve picked a design that suits your building and desired warehouse flow, create a floor plan that documents your new layout.
But slotting in all your equipment, workstations, and aisles into your layout — and doing so accurately — is no small feat. Keeping track of all the measurements alone is a headache. Fortunately, you can use a digital twin to reference dimensions and proximity of things like fixtures or doorways in your actual facility 24/7.
With Matterport’s Facilities Management features, capture your building in photo-realistic 3D to create a virtual version of your warehouse. The digital twin includes accurate measurements of the interior, exterior, and exact dimensions of all your equipment. From there, use virtual staging to make design modifications to your floor space. For example, you want to try out a U-shaped design, but after staging, you find that your aisles don’t have enough clearance for materials handling equipment like forklifts. You’re then able to change it up to find a layout that works better for your space with the convenience of a digital model.
Because it’s simple to create and adjust warehouse floor plans, owners and managers can also optimize equipment installations using their digital twin. Eliminating equipment clashes and change orders from inaccurate site plans saves serious time and money. Planning Mechanical, Electrical and Plumbing (MEP) work to accommodate new equipment is more accurate when using the true-to-life digital replica to scope the changes.
Have a plan to train employees
Once you’ve settled on a warehouse floor plan, communicate the changes to your staff. They’ll need to know the ins and outs of the new layout — even if they’re supporting operations in far-flung locations off-site.
Again, this is where a Matterport digital twin can do the heavy lifting. New and visiting employees can quickly get a sense of your space with a 3D walkthrough of your new warehouse layout. They’ll be able to assess design modifications quickly, and it’s easier to update workers about particularly complex facilities.
And with a comprehensive 3D model and schematic floor plans in hand, you can easily train employees on the warehouse’s emergency procedures. Use your floor plans to create and share emergency routes, response strategies and safety standards.
This was the case with Northumbrian Water, a utility company in the United Kingdom. After working with Matterport to create 3D models of their facilities, they were able to significantly reduce site visits for engineers and project managers. Employees were able to understand facility layouts prior to visits, so they were able to cut down on repeat visits and can now conduct virtual site meetings over Microsoft Teams.
Have a supplier engagement plan
Inevitably, you’ll need to create a strategy to keep your facility and equipment humming right along. You’ll have to regularly engage vendors like plumbers, electricians, and more to keep your warehouse running smoothly.
Fortunately, Matterport makes it simple to compile a plan for your facility’s design and ongoing maintenance. The Facilities Management solution builds a visual record of all your current equipment and assets, then allows you to use digital tags to label them with notes on repairs, maintenance, and training details.
From there, you can quickly share your equipment inventory and relevant notes with maintenance personnel for additional context. And this visual inventory management feature also makes it easy for maintenance staff and personnel to find specific machinery in your facility.
This is another area where Northumbrian greatly benefitted. Northumbrian Water invests $250-300 million each year refurbishing and creating new water management and delivery systems. With so many facilities and systems, keeping track of all these assets is a headache.
However, Matterport coupled with Sitedesk allowed Northumbrian to visualize and link all these systems. And because these facilities and systems are linked, it’s easy for managers to quickly pull up crucial details like equipment model numbers, installation dates, acquisition costs, and maintenance schedules.
Examples of real warehouse models
Digital twins are a powerful tool to ensure facility managers and owners choose the right layout and maximize their space. Now, you can get inspired by some of the possibilities with real-world examples of warehouse models.
For example, a digital twin gives you a complete understanding of a space when it’s a blank slate, like this lower-level storage space.
Source Facility managers and owners can also lean on virtual staging to help configure equipment and workstations in a space. With a digital twin, you have your warehouse’s exact dimensions captured, so it’s easy to experiment with different layouts and designs virtually.
For warehouses with multiple rooms or alcoves, you can get a bird’s eye view of the floorplan so you can easily visualize the space while considering the layout. You can also manipulate your 3D model in what’s called a “dollhouse” view to explore it from any rotation.