Storage capacity/storage economy

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Storage capacity is defined as the maximum number of loading units that a warehouse can hold. It also represents the actual capacity of a warehouse. It directly relates to the size of the storage area, the height of the warehouse (usable space), the structure and turnover rate of the inventories and ultimately the economic efficiency of a warehouse. Economic efficiency is determined by many key figures that can be generated and analysed by an ERP system.

For cost reasons, a company always assumes the following situation: Storage means the intentional or unintentional interruption of the operational material flow. Thus additional costs result from the storage. The storage capacity is calculated by considering the size of the designated main area of the storage facility and the usable space above it.

The following storage code numbers/key figures are taken into account when determining the economic efficiency of a warehouse:

  • Inventory intensity
  • Order costs
  • Excess stocks
  • Delivery quota according to customer segmentation
  • Average stock level
  • Inventory turnover rate
  • Average storage duration
  • Storage interest rate
  • Stock range/delivery readiness
  • Stocking ratio
  • Bearing utilisation factor
  • Delivery readiness level
  • Capital commitment
  • Key figures for the use of means of transport
  • Additional descriptive bearing parameters

 

Important key figures for storage capacity/storage economy

  • Inventory turnover rate: It indicates how many items the storage handles or sells per year/month/day. It is, therefore, also the yardstick for the quality of the purchasing policy.
  • Bestellkosten: Analysiert man die Bestellkosten, zeigen die daraus resultierenden Kennzahlen detailliert, wie teuer alle tangierenden Prozesse bei einem einzigen Bestellvorgang sind. Darunter fallen unter anderem der interne Transport sowie sämtliche Prozesse für die zuvor eingeleitete Einlagerung.
  • Overstocks: They usually have different causes. For example, incorrect sales forecasts can lead to an artificial build-up of inventory. But also incorrect dispositions, as well as discontinued models, are possible causes for costly (value adjustments, scrapping actions) overstocks.
  • Delivery quota according to customer segmentation: This key figure is a profane means of calculating the interval at which a customer must be supplied. If, for example, the customer uses a high storage capacity, the assumption that the delivery intervals per time unit are small seems justified—the delivery quota assists in planning both the route and the required transport units.

Storage economy

If the storage capacity described above is dimensioned with the maximum capacity (quantities, masses, volumes and value variables); the resulting storage economy uses the entire range of all the storage key figures mentioned. Thereby the efficiency of a warehouse is in the generally known cost-benefit relation. This relation also takes into account the human factor.

The most important factors in the profitability of a warehouse are turnover rate, storage duration and the actual storage cost rate (personnel costs, maintenance, insurance, product damage, energy costs, etc.). The storage duration can also lead to different and negative side effects; for example, if product storage lasts longer than planned: less storage space, lower sales/turnover, low inventory turnover. Putting these three factors (turnover frequency, storage duration, storage cost rate) in relation, the profitability of a warehouse can already be estimated without including all key figures in the calculation.

For more information on this topic, see Replenishment in Intralogistics and Utilization Level.

Image source: Seika, License: (CC BY 2.0)

About TUP - Editorial Team

TUP - Redaktion

The editorial staff of DR. THOMAS + PARTNER GmbH & Co. KG has created the platform Logistik KNOWHOW, administrates and coordinates the contributions and creates content for various categories itself. The software manufactory DR. THOMAS + PARTNER from the Karlsruhe area has been implementing customized intralogistics IT systems for over 35 years, with a special focus on warehouse management and material flow. Among its renowned customers are national and international companies of various sizes and industries.

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