How to Measure Warehouse Performance

Warehouse Performance, Cost, and Value Measures

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the warehouse as a whole or in any activity) to the estimated maximum capacity units per hour. Another common utilization measure is the storage location utilization, expressed as the ratio of the number of occupied warehouse locations to the available warehouse locations. Equally important to monitor is the warehouse cube utilization, expressed as the ratio of the occupied cube to the total available cube. A major difference between productivity and utilization is that we always want to maximize productivity, whereas there are appropriate control limits for utilization. For example, we always want to maximize storage density, the number of storage positions available per square foot, but the utilization of storage space should range between 70% and 90% on a consistent basis. Storage location utilization higher than 90% leads to productivity decreases and potential safety problems. Utilization lower than 70% suggests excessive storage capacity.

Figure.21 RightChain™ Warehousing Scoreboard Utilization 360 Screen Displays the Utilization of All Key Warehouse Resources Including Workforce, Vehicles, Storage, and Docks

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