Sizing
Several techniques are available to help estimate warehouse size. Each method begins with a projection of the total volume expected to move through the warehouse during a given period. The projection is used to estimate base and safety stocks for each product to be stocked in the warehouse. Some techniques consider both normal and peak inventory. Failure to consider utilization rates can result in overbuilding. It is important note, however, that a major complaint of warehouse managers is underestimation of warehouse size requirements. A good rule of thumb is to allow 10 percent additional space to account for increased volume, new products, and new business opportunities