Procurement Management  ·  Level 6
Manage Warehousing Of Procured Goods
Chapter 1: Establish Warehouse Design
📚 6 Topics
⚑ What you will be able to do

By the end of this chapter, you will be able to:

  • Identify the best warehouse location by following your organization's procurement policy.
  • Determine key warehouse design features that match your organization's specific needs.
  • Recommend the right resources needed to create an effective warehouse design based on actual warehousing demands.
  • Review and check the warehouse design to make sure it fully meets all warehousing requirements.

Mastering these skills helps you create efficient, well-organized warehouses that keep goods safe and operations running smoothly in the real world.

Compiled by: Simon Ngugi

1.1 Warehouse design

Warehouse design is the planning of a storage building and its internal systems so that procured goods can be received, stored, protected and issued at the lowest total cost and with the least handling. It covers the size, shape and height of the building, its structure, its doors and loading docks, the storage and handling systems it will use, and its services such as lighting, drainage, ventilation and fire protection. A design decided well at the start lasts for the life of the building, while a poor design leads to congestion, damaged goods and high handling costs that are hard to correct later.

Example: a Kenyan manufacturer of building materials planning a new finished goods warehouse first estimates how many pallets of cement, tiles and paint it must hold at the peak season, how many lorries will load each day and how the goods will be handled. These figures, not the shape of the plot alone, decide the size, height and number of docks of the building.

Objectives of warehouse design

A warehouse is designed to serve the supply chain of the organisation. The main objectives are:

  • Adequate capacity: The building must hold the planned stock, including seasonal peaks and a margin for growth, without goods being stored in aisles or outside.
  • Efficient flow of goods: Goods should move from receiving to storage to dispatch in a direct path, with as little back-tracking and double handling as possible.
  • Protection of goods: The structure and services must protect stock from rain, heat, dust, pests, fire and theft so that it reaches users in good condition.
  • Low operating cost: The design should keep labour, energy, handling and maintenance costs low over the life of the building.
  • Safety of people: Aisles, docks, racking and lighting must allow staff and equipment to work without accidents.
  • Flexibility: The design should allow the warehouse to change its product range, storage systems or volumes without major rebuilding.

Main elements of a warehouse design

The designer makes decisions on a set of linked elements:

  • Building size and shape: The floor area and the length-to-width ratio are set from the volume of stock and the flow of goods. A rectangular building is easier to lay out and to rack than an irregular one.
  • Clear height: The usable height under the roof structure decides how high goods can be stacked or racked. A higher building stores more on the same plot, but needs suitable handling equipment.
  • Floor: The floor must carry the load of stacked goods, racking and handling equipment and be level and smooth for forklift trucks.
  • Column spacing: Wide spacing between roof columns gives freedom to arrange racking and aisles; columns placed without planning waste space and block aisles.
  • Doors and loading docks: The number, size and position of doors and docks are set from the number of vehicles received and dispatched per day and the types of vehicles used.
  • Storage and handling systems: The choice between block stacking, shelving or pallet racking, and between manual handling and forklift trucks, affects aisle widths, height and floor strength.
  • Services: Lighting, ventilation, drainage, power, water, fire detection and fire fighting, and security systems are planned into the building from the start.
  • Offices and staff facilities: Stores offices, document rooms, washrooms and changing areas are placed where they support supervision without blocking the flow of goods.

Steps in designing a warehouse

  1. Define the purpose of the warehouse: which goods it will hold, whom it will serve and the service level expected, for example next-day delivery to branches.
  2. Collect data on the goods: number of items, sizes, weights, unit loads (pallets, cartons, bags), special storage needs and expected stock quantities, including peaks.
  3. Estimate the flow: the number of receipts and issues per day, order sizes and the vehicles used, so that docks and handling capacity can be sized.
  4. Choose the storage and handling systems that suit the goods and the volumes, since these decide aisle widths, heights and floor loads.
  5. Calculate the space needed for receiving, storage, picking, packing, dispatch, offices and services, and add a margin for growth.
  6. Prepare the outline building design and the internal layout, then compare alternatives on cost, flow and flexibility.
  7. Check the design against safety, fire and building approval requirements and the views of the users, such as storekeepers and drivers.
  8. Prepare the final drawings, cost estimates and specifications for construction or for fitting out a rented building.
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🔒1.2 Attributes of a good warehouse design

The attributes of a good warehouse design are the qualities that show a building will store procured goods safely and economically and support fast, accurate service to users. They are used as a checklist when a new warehouse is planned, when an existing build…

🔒1.3 Types of warehouses

Warehouses are grouped by who owns and operates them, by the goods they hold and by the role they play in the supply chain. Knowing the types helps a procurement and stores officer choose where to keep procured goods: in the organisation's own building, in spa…

🔒1.4 Benefits of warehousing

Warehousing is the holding of goods in a suitable building between the time they are procured or produced and the time they are used or sold. Its benefits explain why organisations accept the cost of buildings, staff and stock holding: warehousing evens out th…

🔒1.5 Factors to consider in location of a warehouse

The location of a warehouse is the site chosen for the building, both the general area (which town or region) and the particular plot. Location is a long-term decision that fixes transport costs, delivery times and the cost of land and labour for many years, s…

🔒1.6 Resources needed to design a good warehouse

Designing and putting up a good warehouse needs three groups of resources: money to pay for land, building, equipment and fittings; equipment to store and handle goods and to run the building; and skilled personnel to plan, build and operate it. These resource…

Am I competent?

At the start of this chapter we promised you would be able to:

  • Identify the best warehouse location by following your organization's procurement policy.
  • Determine key warehouse design features that match your organization's specific needs.
  • Recommend the right resources needed to create an effective warehouse design based on actual warehousing demands.
  • Review and check the warehouse design to make sure it fully meets all warehousing requirements.

Tick each one you can genuinely do.

So, are you there yet?

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