How to Layout a Warehouse or Distribution Center

Pallet Storage Space Requirements Estimation

1. Divide forecasted unit sales by annual inventory turns to compute average on-hand unit inventory. 2. Divide the average on-hand unit inventory by the average units per pallet to compute the average on-hand pallet inventory. 3. Multiply the average pallet inventory by the ratio of peak-to-average inventory to compute the peak pallet inventory. 4. Multiply the peak pallet inventory by the portion of peak inventory used for storage planning purposes to compute the effective pallet storage capacity. 5. Divide the effective pallet storage capacity by the location utilization factor to compute the required number of pallet storage locations. 6. Divide the required number of pallet storage locations by the storage density (square feet per pallet computed as a function of the aisle width and storage height) to compute the floorspace requirements.

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