How to maximise warehouse space when expansion isn’t an option

Empty Warehouse

7 ways to maximise warehouse space without physically expanding


The expense of operating a warehouse is huge; from acquiring the land, to operational costs, managing equipment, labour costs and of course storing inventory. Warehouse managers constantly face the challenge to efficiently utilise space and reduce costs. When expansion isn’t an option, the most practical, low-cost solution is to find and use the hidden space in your warehouse.


Largely, there are three key types of space deficiencies that are noted in a warehouse:


  • Holding too much right inventory
  • Holding too much wrong merchandise
  • Using the existing warehouse space ineffectively


In order to address your space issues, it’s  important to understand how they have occurred.


Here are 7 ways to maximise warehouse space without physically expanding:

Vertical cube utilisation

For warehouses looking to increase the amount of pick faces and improve storage, optimising the use of the vertical cube is paramount. The vertical cube consists of all the space above the cross aisles, loads, docks, work and pick areas. The optimum use of racks exists when the opening height is roughly 6 inches larger than the load height in order to ensure safety when loading and unloading goods. An optimised warehouse will attain around 75 to 85 percent vertical utilisation. Those warehouses with space usage of between 50 to 75 percent present a major opening to improve and recover use of the lost space. By altering the opening sizes to match the dimensions of the current unit load and thereby creating several opening heights, the warehouse programme can be re-adjusted to place the slower moving pallets in shorter locations.

For products requiring a smaller amount of storage, it’s a good idea to load cases on decking or case flow racks. This removes some of the pallet storage and provides a greater pick face area, optimising use of the vertical cube.


Tunnel rack

The area over cross aisles is rarely used efficiently within the warehouse. This underused space can instead be transformed and used for storage in the form of tunnel rack. Usually, in warehouses that have 20 -24-foot clearance and contain 4 levels of storage, the top 2 levels are generally tunnelled. When implementing tunnelling over aisles, it’s important to place safety netting to avoid falling cases landing on the warehouse floor. When tunnelling existing racks, the space between each section can differ by up to an inch, meaning warehouse operators have to carry out tunnelling in line with forklift training to move down accordingly with fork mast.


Rack over docks

With most of the movement taking place in the bottom 10 feet of space, docks fail to take advantage of the vertical cube space. To counteract this wastage, warehouse operators should use the area above the dock doors to place racking for storage purposes; to hold packaging materials for example.



Mezzanine floor systems are raised platforms installed between the floor and the ceiling in a warehouse, to optimise storage and increase work space. They are usually made of steel with a wood finishing and can be disassembled and easily moved. Warehouse mezzanine systems offer maximised usage of the vertical space; the valuable space already available but often underused. Once the mezzanine system is in place, the space underneath the structure can also be availed of for storage.


In warehouse operations where goods are sent directly to customers, or during smaller order processes, the products tend to be picked on a piece pick basis before being packaged and prepared for shipment at secondary packing stations. While these warehouse zones involve low clearance, they still use up beneficial space. One way to re- capture this space is by integrating mezzanine structures above the workspace. Although this option can create approximately a 50 percent vertical space utilization, it is costly to build and hinders future flexibility.


Alternative Storage Methods


If facility alterations like tunneling rack and mezzanines are not enough, you can opt for alternative storage methods to widen the aisle pallet rack, including:


  1. Narrow Aisle Pallet Rack (NA)
  2. Very Narrow Aisle Pallet Rack (VNA)
  3. Double-Deep Pallet Rack and Pushback Rack
  4. Pallet Flow Rack
  5. Small Parts Storage


It’s important to note that these options are reliant on column spacing and other fixed obstacles allowing for the design changes.

Regardless of the changes made to optimise space, some cost will be involved. Once changes are in place, it’s important to continue to review the warehouse storage plan and make any further changes necessary to optimise it.


Automated Storage and Retrieval Systems (AS/RS)


While the above points inform warehouse management how to optimise warehouse space, the suggestions are only a short term solution. Integrating automated storage and retrieval systems can greatly reduce the issue of space limitations. AS/RS comprise of various machinery such as conveyors and lifts that lessen the space occupied by aisles and instead capitalise usage of the space.


There are some disadvantages of automated storage systems too. Although they offer a long term solution for optimising warehouse space, they are costly to install and require continuous maintenance. In terms of future flexibility, AS/RS systems are limited in that making changes to the set-up is highly complex. Hence why operators must check that the system is initially planned to meet future demands before it is built and set up, when alterations are difficult to make.


Improved inventory management


When it comes to efficiently managing inventory, access to real time stock information via a warehouse management system (WMS) is a must, from the point of sale right down to the delivery of raw materials. An inventory counting system such as a cycle count should also be carried out to monitor stock and make sure outdated stock isn’t taking up valuable warehouse space. Warehouse management systems can provide operators with insightful data on the optimum item storage locations based on product movement and sizes.

Another inventory management approach is to only stock the medium and high moving stock in your warehouse and employ suppliers to ship the slow moving items directly to the consumers. This lowers the amount of inventory needing stored in the warehouse and also partly eliminates some of the picking requirements.


When a warehouse is faced with increased demand and expansion isn’t a feasible option, being able to identify the existing hidden space is vital. Once operators have recognised why the inefficiencies have occurred, making any of the above changes will help generate more space and improve overall operations without having to physically expand the warehouse footprint.