After three decades working in supply chain, I’ve seen a lot of distribution networks and warehouses that simply don’t work as well as they should. Some were poorly conceived from the start. Others started fine but drifted into inefficiency over time. The common thread? The fundamentals got overlooked somewhere along the way.
This guide brings together everything I’ve learned about both distribution network design and individual warehouse design. These two disciplines are deeply connected, of course. Your network determines where your warehouses sit, and your warehouse design determines whether those locations actually deliver value. Get one wrong and you’ll struggle with the other.
I’ve structured this around the critical success factors for network design and the core principles for warehouse design. But honestly, the real value comes from understanding how they interact. A brilliant warehouse in the wrong location is still a problem. And the best network strategy falls apart if your facilities can’t execute.
Let’s get into it.
Part One: Distribution Network Design
If you’ve followed our blog over the years, you’ll know that we’ve shared lots of information about distribution network design, why it’s vital to get it right, how long it should take, the importance of reviewing the network every so often, and various elements of design such as determining the number of warehouses and where to locate them.
In this section, we’re revisiting the topic with a more holistic approach, focusing on six factors that can make the difference between an optimal and suboptimal distribution network design. The information we’re sharing here will be of particular value if you are (or will be) involved in designing a new network or upgrading or expanding an existing one.
1. Quality and Detail of Data and its Analysis
In some of our earlier posts, we’ve stressed the importance of simplicity in distribution network design, and we will return to that topic later in this article. However, the one thing you have in your favour today, which would have been much harder to benefit from in the past, is the capture and analysis of data to inform your design.
It would be folly not to take advantage of data availability and accessibility. So, while simplicity of design is a worthwhile goal, investment of time and resources in comprehensive and detailed data analysis can never be a waste. Indeed, careful attention to data in the preparation stage is indispensable for delivering a simple yet optimal design.
As a primary requirement, it’s necessary to understand the range of data types requiring collection and interpretation. It’s not a short list, so we’ll set it down here as a summary to help you with plans for analysis.
Essential Data for Effective Distribution Network Design
The data types that you should consider critical for analysis in distribution network design include:
Customer locations: The geographical distribution of your customer base.
Customer order history: Historical customer order volumes and frequencies.
Service requirements: Customers’ service level and delivery lead time expectations.
Product attributes: Product sizes, weights, and other relevant characteristics.
Demand variability: The patterns of demand for each product.
Supplier locations: Geographic locations of your suppliers and their lead times.
Supplier performance: Reliability and on-time delivery rates of each supplier.
Inventory levels: Current or expected inventory levels at various locations.
Inventory turnover: Inventory turns for each SKU.
Transportation options: Costs and lead times for each available transportation mode.
Transportation costs: Freight rates, fuel and labour costs, and other transportation expenses.
Route data: Transportation routes, distances, and transit times.
Warehouse capacity: The storage capacity and utilisation of existing facilities.
Throughput rates: The processing capacity of distribution centres.
Labour productivity: Efficiency and productivity of picking, packing, and shipping activities.
Market conditions: Data relating to market dynamics, demand shifts, and emerging markets.
Competitor intelligence: Distribution strategies and network designs of your competitors.
Regulatory/Legal Compliance: Customs regulations, safety standards, and labour laws.
Sustainability goals: Evaluate options for eco-friendly distribution processes.
Fixed costs: Distribution centre fixed costs, such as rent, utilities, and equipment.
Variable costs: Relating to transportation, labour, and inventory management.
“What-if” data: Scenario simulation to assess the impact of design options under various conditions.
The Importance of Time and Technology
By gathering and analysing the data we’ve listed above, or as much of it as possible, you will gain credible intelligence to inform decisions about your distribution network design. Of course, it can add up to a vast pool of data, so realistically, access to advanced modelling and analytics tools will be essential to get the most value from it.
Time is another resource you will consume in analysing all this data. If you’d like to know how much time we’re talking about, you’ll find a helpful video on our YouTube channel, discussing timescales for network design at various levels of detail. Why not take a look at it now, using the button below?
[View Video: Want to know how long it takes to design a distribution network?]
2. Clarification of Design Objectives
While the need to start a distribution network design project by focusing on objectives may seem obvious, you might be surprised at how many companies either omit this step or settle for defining an overarching objective such as cost reduction or geographic expansion.
To do so is a mistake because a successful and future-proof distribution network design will typically need to meet several objectives. While there may well be a single primary goal for the network, such as expanding into a new region, other factors will likely merit serious consideration, too.
For at least some of these design aspects, a clearly defined goal will ensure their potential impacts stand out amid the big picture and will also be helpful when it comes to scenario modelling.
First and foremost, of course, you should ensure the objectives for your distribution network align with those of your supply chain strategy, which in turn should support the overall goals of your business. Again, we mention this because strategy misalignment is an issue we often encounter in our work with clients, often leading to—or exacerbating—many challenges that could otherwise have been avoidable.
Some Common Distribution Network Objectives
Aside from alignment with business objectives, network design requires a clear, cross-functional understanding of complementary or secondary goals, which, for example, might include any of the following:
- Cost reduction
- Service level improvement
- Market expansion
- Inventory optimisation
- Improvement of supply chain resilience
- Environmental goals
- Delivery lead-time reduction
- Warehouse/DC utilisation improvement
- Regulatory compliance
- Scalability goals
- Competitive advantage
- Reducing cost to serve
- Improvement of supplier relations
- Support for customised distribution strategies
Whatever the goals of your distribution network, they should form a central tenet of its design. By ensuring that all stakeholders are aware of, and in agreement with them, they will remain in sharp focus during decision-making, preventing the design from lapsing into aimlessness.
3. A Focus on Simplicity
In an earlier paragraph, we mentioned the importance of simplicity and that it would feature as a topic in this article. As promised then, we’ll look now at the need to minimise design complexity, focusing on some of the possibilities to keep your distribution network as simple as feasibly possible.
Process Standardisation
It’s not only the physical network, as in the location of distribution centres and warehouses that you must consider in the drive for simplicity. It’s vital to think about your processes, too. By standardising distribution processes across your network, you can simplify operations for economy and efficiency.
Order picking, packing, transportation processes, and inventory management practices and procedures are all worthy targets for standardisation.
Optimised Facility Location
If you are designing a new distribution network from scratch, naturally, you can plan for an optimal approach to the locations of distribution centres and warehouses. Things can become more challenging when designing improvements to an existing network.
In this case, evaluating the number and locations of your facilities makes sense. Consolidate or close any underutilised warehouses or those you believe can be omitted from your network without any significant negative impact.
In our work with clients, we often succeed in making an existing network more effective by removing a distribution node or two. For a new network, it will certainly be worth comparing the trade-offs involved in operating several small distribution centres versus fewer but more extensive facilities.
Keeping distribution centres to a minimum can help you avoid excessive complexity in your distribution network while simultaneously offering the potential for cost savings.
Rationalised Routing
Whether creating a new network or revising an existing one, beware of complexities arising from transportation choices, especially when planning your DC locations. Try to avoid introducing the need for backtracking and detours in transportation.
For instance, ask yourself if you genuinely need a warehouse in a given location or whether a cross-docking operation, which requires little storage space and presents no on-site inventory management complexities, would suffice.
You may have noted how, interestingly, we drift back to the warehouse/DC location topic when discussing transportation and routing. If you’re wondering why that’s so, know that the number and location of hubs in your network will significantly influence your primary and secondary distribution routing.
It’s worth remembering, for example, that secondary distribution tends to generate higher transportation costs than primary distribution. That’s why you’ll need to seek a balance between keeping inventory close to your customers (to reduce outbound logistics costs) and keeping the number of warehouses in your network as low as possible.
Avoid “Complexity Creep”
It’s all very well to aim for simplicity in a distribution network design, and indeed, if you achieve it, you can consider it a win. But even then, the initial level of simplicity will probably not endure for more than a few years, and complexities may even begin to creep in faster than you would expect.
Remember, market conditions can change rapidly, especially these days, meaning that regular reviews of your distribution network are essential to check for evidence of this “complexity creep”.
One way to avoid complexity creep is to build scalability into the distribution network design, an initiative which we will cover in detail in point no. 4 of this article.
Beware of Over-engineering the Design Process
Finally, while we’re on the topic of complexity, remember that it’s possible to overcomplicate the actual design process and that, too, can lead to unnecessarily complex results.
If that assertion needs some elaboration, we’re saying that while many of the points covered in this article will be most relevant for larger organisations requiring substantial network coverage, some will be useful for less ambitious network design projects. In such cases, the design process can often be kept relatively simple, demanding less time and requiring less sophistication in the tools used.
In our video, Distribution Network Analysis, we offer insights into the time required to complete a distribution network design project using various tools and approaches, from the back of an envelope to the sophisticated and detailed studies necessary for a network with extensive coverage.
[View Video: For more about network design approaches, watch this video.]
4. Built-in Scalability
This topic makes an appropriate addendum to the discussion about the simplicity of your network because one of the factors that often drives increased complexity is business growth.
Any substantial increases in distribution volume can lead to capacity bottlenecks, potentially requiring the addition of new warehouses to serve as overflows for your existing facilities.
However, additional warehouses add complexity to the network, not only because they exert more pressure on your shipping and transportation operations but also because they increase the inventory management burden.
New warehouses can also add complexity to the demand side of your network, sometimes requiring adjustments to supplier agreements or even generating a need for additional suppliers.
The good news is that there are ways to avoid network complexity arising from business growth. One approach is to design your network to be scalable. So, let’s move on now to look at how you can do that.
Flexible Facilities
To allow for future increases in warehouse capacity, it can pay to design your facilities to be flexible. There are several ways to do so.
One possibility is to develop expandable infrastructure and acquire facilities with plenty of yard space. That will afford you the option to expand the physical dimensions of the warehouse if (or when) it should become necessary.
Of course, this can be costly, but comparatively less so than retroactive warehouse leasing, purchasing additional warehouses, or relocating an entire DC operation to larger premises.
Design for Partnership
Another way to build scalability into your distribution network is to design it in partnership with one or more 3PL providers, or to design with the express intention of working with 3PLs in some geographic regions or locations.
Naturally, you must identify and work with providers offering warehousing services in your chosen locations and the ability to scale their resources to meet your future operational needs.
This approach can reduce the capital costs involved in your network setup. It also provides the on-demand scalability that will not be present in a network relying solely on assets owned or leased by your company.
A similar methodology might be appropriate for the transportation aspect of your distribution network. By designing the network to be served by 3PL providers or planning to work with a combination of carriers, you can enhance your company’s ability to scale its distribution operation as necessary.
5. Consider the Inventory Impact
Network design projects often neglect to plan sufficiently for inventory deployment into a new distribution network. It’s an oversight we recommend that you avoid since the success of a network depends on how well you factor inventory management into your design.
Indeed, the more DCs and warehouses your network will comprise, the more its success will depend on inventory optimisation, and the best time to optimise inventory is during the design process, after determining the number and location of facilities required.
Getting Complicated? Get Some Help
Of course, inventory optimisation is not a task to take lightly. To pull it off during network design, you will need access to software sophisticated enough to run algorithms, enabling you to model scenarios and find a balance between meeting required service levels and minimising inventory carrying costs.
It’s vital to remember, too, that optimal results depend not just on stocking strategies for each warehouse but also on other factors like transportation routing and individual facility design.
Therefore, engaging a consulting partner to assist you is a good idea. A good consulting firm can give you access to the tools you need, along with the expertise and experience of people who design distribution networks regularly.
6. Design for Sustainability
Eco-friendly distribution is a judicious goal for a new network design and a noble justification for reviewing and adjusting an existing one. It’s also a goal that, when achieved, significantly contributes to overall network success.
Does this mean that you should disregard all other network design goals? Not at all.
After all, the distribution network is only a means to an end for just about every business, so it would be folly to focus on maximising sustainability to the exclusion of every other consideration.
Nevertheless, we’re recommending sustainability as a success factor to consider because of the many ways in which it can benefit your organisation, aside from the obvious contribution to the war against environmental degradation.
Stakeholders Look for Sustainability
Let’s look at the reputational benefits first, because a clear commitment to reducing the environmental impact of your distribution network is a strong selling point in any area of commerce and industry.
For example, a positive reputation for sustainable practices can bring your company to the attention of an increasingly large sector of society concerned about our planet’s future. That includes environmentally conscious customers, giving them a reason to choose your company over competitors that score lower in the corporate social responsibility stakes.
While that might be an advantage that fades over time, as more and more companies, quite correctly, increase their focus on sustainable business, there is a lot to be said for winning over these customers early. And there’s time yet to garner a sense of loyalty among them, strengthening your hand later against competitors that are slower to show their environmental commitment.
Along with customers, investors and stakeholders are also likely to consider a company’s environmental and social responsibility when making decisions. A commitment to sustainability can attract responsible investors and satisfy stakeholder demands.
Sustainability’s Impact on Cost, Efficiency, and Service
Sustainability benefits are not limited to corporate marketability. There are operational wins to be had, too. A primary goal of sustainability in a network is to reduce resource consumption and waste, which can result in cost savings.
For instance, designing the transportation network to minimise fuel usage can lower fuel costs, while energy-efficient facilities reduce electricity expenses.
Moreover, sustainable network design can also yield efficiency gains in your logistics operation, making for smoother processes and shorter lead times. That, in turn, can boost your customer service performance.
Here’s the thing that often gets lost when we talk about network design and warehouse design as separate disciplines: every decision you make at the network level creates constraints at the facility level. And if you’re not thinking about both simultaneously, you’re setting yourself up for problems.
Let me give you a practical example. Say your network analysis concludes that you need a distribution centre in a particular region to hit your service level targets. That’s a network-level decision. But the moment you make it, a cascade of facility-level questions follows. What throughput will that DC need to handle? What’s the order profile going to look like—are you shipping pallets, cases, or individual units? Will you need cold storage? How much dock capacity do you need for inbound versus outbound?
If you answer those questions without reference to your network strategy, you’ll end up with a facility that’s technically well-designed but strategically misaligned. I’ve seen warehouses built with beautiful automation systems that were completely wrong for the order profiles they actually had to handle—because nobody connected the network planning to the facility planning.
The reverse is also true. Sometimes the constraints of available facilities should inform your network decisions. If the only viable warehouse options in a target region are older buildings with low clear heights and limited dock doors, that reality needs to feed back into your network modelling. Maybe the service level benefits of that location don’t outweigh the operational compromises you’ll be forced to make.
This is why, when we work with clients on network design, we’re always thinking ahead to facility implications. And when we’re designing or optimising a warehouse, we’re always asking how it fits into the broader network context.
With that connection in mind, let’s turn to the principles that govern effective warehouse and distribution centre design.
Part Two: Warehouse and Distribution Centre Design
Now we shift focus from the macro level of network design to the micro level of individual facility design. The thing is, even if you’ve nailed your network strategy, the execution happens inside your warehouses. And warehouse design is a discipline that, honestly, gets misunderstood more often than it should.
I’ve lost count of the underperforming facilities I’ve walked through over the years. Not because the people running them were doing anything wrong, but because design decisions made years earlier had locked them into inefficiency.
This section outlines seven principles that will help you understand the key aspects of the design task and plan your facility for optimal performance.
One warning before I begin. The principles will not make you into a seasoned designer, but they will help you understand the salient aspects of the design task, and help you plan your facility for optimal performance.
1. Determine the Objective of the Facility
In a recent web discussion with a number of warehouse professionals, I asked what they believe to be the critical principles of effective warehouse design. This principle ranked at top of the list. The first step is to define the objectives and goals of the facility. For example:
- Why will it exist?
- What market does it serve?
- Is it part of a network?
- What types of goods will be stored?
- What is the anticipated life of the facility?
- Will it be a green-field site or an existing facility?
It is vital to write these objectives down so that all associated parties remain cognisant of the expected outcome – especially when timing, budget, or resource issues during the project tempt stakeholders to compromise operational or design goals.
Why Does This Matter?
The efficiency, effective utilisation, running costs, working environment of your warehouse all depend on its fitness for purpose. This becomes even more important as distribution and fulfilment processes change in line with the shift toward omnichannel sales.
Few warehouses are merely storage facilities these days, and the last thing you want is to have to extend your facility or outsource certain activities just because of inadequate design considerations.
The objectives you have in mind for your facility should influence its size, physical design, its proportion of indoor warehousing versus outside yard space, its location, dimensions, and structural composition, along with provisions to be made for specialised equipment installations and division between storage and working spaces.
2. Define Volumes and Functional Requirements
The famous British Physician Dr. Thomas Fuller once said, “Get the facts, or the facts will get you. And when you get them, get them right, or they will get you wrong”. This is an important lesson that was also affirmed by my learned web colleagues, and certainly one that has guided my own work throughout my career. Quite simply, the facts needed are:
A) Quantities of products to be stored.
B) The throughput velocities, including incoming goods, customer orders, inter-facility transfers, dispatches, and returns.
C) The nature of orders and specific picking requirements, e.g. is picking performed in containers, pallets, cartons, inners, or single units?
Now if you are thinking that this is easy, think again. It is one of the hardest and most time-consuming components of a design project. Why? Because rarely do enterprises have such data readily available. Designers must therefore ‘mine’ it from the enterprise as best they can.
In cases where data is piecemeal or nonexistent, the designer must draw from experience to fix assumptions around volumetric estimates. This can be particularly challenging when heavy scrutiny is placed on the designer to prove the concept, and is best performed with the collaboration and agreement of the stakeholders involved.
It can also make a lot of sense to enlist some external help, perhaps from a warehouse design consultant, for this stage in the project. Any such expert should have the expertise and experience to conceive and develop a warehouse design using whatever data is available, and to extract the data efficiently.
D) What functions need to be provided for?
It’s imperative that the designer understands all of the functions to be included on the site footprint, e.g. warehouse, offices, gantry cranes, loading docks, forklift-charging areas, dangerous or hazardous goods, cool or cold rooms, clean rooms, manufacturing or packaging operations, staff facilities, etc. It is equally important that relative dependencies between functions are determined, so that the designer can correctly frame functional proximities for best flow and operation by staff.
Why Do These Things Matter?
Warehouses are expensive capital investments, so when you design a new one, you want to be sure your business will not outgrow its volumetric capacity or throughput capabilities too quickly.
That’s exactly what will happen if, for example, you underestimate the quantities of products your warehouse must comfortably hold. I say “comfortably” because you never want your warehouse to be running at 100% of physical capacity. After all, aside from anything else, you need a fair amount of working space.
It’s not just about storage space though. You will need to make sure you calculate, for example, how many intake doors will be optimal for your volumes of incoming goods.
If you have too few goods-in doors, you may suffer bottlenecks in your goods-receiving processes, which not only influence your own operation, but those of your suppliers too. While planning too many doors might not affect your operation, it will add unnecessary cost to your warehouse design and build.
3. Match Storage Modes, IT Systems and Mechanised Technologies with Volumes
Once the data has been analysed, the designer is ready for equipment selection. Be it static racking equipment, mezzanines and the like, or mechanical equipment such as conveyors, carousels, stacker cranes etc., all equipment and systems must be applied according to their purpose, limitations, and suitability for the volumes handled.
For instance, it is a waste if an automatic storage and retrieval system is installed, when a conventional racking system will suffice. Equally, if the facts justify a high-velocity automated system, it is foolish to ignore them for the sake of a more conventional system.
One critical aspect of equipment selection is that the designer has an expert understanding of the equipment and technology available, and knows how to apply them.
This is a complex area and deserves careful consideration. Novice designers should consult material handling equipment and software suppliers, builders, and industry specialists to ensure the design is well founded, robust, and practical.
4. Flow
This aspect incited some interesting comments from my web conference colleagues. From their counsel and my own experience, I suggest that the skillful designers apply two immutable laws of flow.
A) One-way flow
The best warehouse operations are those adhering to this principle. Whether straight, clockwise, counterclockwise, up or down, make sure the flow is one-way only. But here is a tip… Be cautious when dealing with international customers, whose cultural or religious beliefs may drive specific requirements. An interesting challenge that I experienced on a recent project was the Hindu philosophy of Vaastu Shastra.
The customer politely stipulated that the warehouse flow should be clockwise, heavy goods should be stored in the south-west, with lighter products in the northeast. The front door and offices should face east with entry to the site from the north. This provided an intriguing set of constraints that I happily applied to the design of the site and building. The key point here is that despite restraints, the designer should stick to the one-way flow principle.
B) Flow versus Capacity
The second rule of flow is that free movement has priority over storage capacity. If you are pressed with a choice, the pundits agree that it’s better to hold flow sacrosanct, as opposed to building more stock or storage equipment.
Why? Because long after the warehouse construction is complete, a team has to work efficiently and safely in the warehouse year after year. If the design compromises on the size and quantity of aisles, for the sake of more stock holding, beware the possibility of suboptimal performance over the facility’s lifetime.
5. Close to Zero Material Handling
A simple rule that says it all: keep manual handling of products to a minimum—ideally no more than 3-5 touches while goods are in the warehouse. Sadly, I have witnessed operations that handle goods as many as eight to ten times. Severe design or building constraints are often at the root of such situations. But the outcome is evident in the maxim: ‘more touches, more cost’. Take note!
Reduction of handling is one of the primary objectives of warehouse layout optimisation, because even with a well-designed warehouse facility, there can be a tendency over time for processes to lose efficiency due to changes in throughput, product ranges, or other elements of the warehouse operation.
That’s why we always recommend our clients to revisit their layout design from time to time, and, if concerns arise about an excessive number of inventory touch points, have us review the layout and offer some ideas and suggestions for optimisation, which is just one of the key warehouse design services that we offer.
6. Evaluate your Options
The developed concept design options must be evaluated to ensure that objectives are achieved. The two common approaches to assessment are:
A) Quantitative analysis: Return on investment, payback, cost per order to supply, cost per order cubic metre to name just a few.
B) Qualitative analysis: Reviewing the advantages and disadvantages of options considered. Ideally, the evaluation is best performed both individually and in a team workshop environment. It is amazing what can be revealed when a team collectively focuses its attention on a project. Despite the meticulous job the designer may have performed, a workshop can often reveal a late insight, idea, or missed detail that can adversely affect the final design.
7. Consult Widely as the Design Process is Multifaceted, Involving Executives, Managers, Operators, Equipment Suppliers, Builders, Architects, and Councils
As part of the development process, all should be regularly consulted on planning and legal matters, operational needs, preferences, ideas, and opinions.
In my experience, no single party has all the background and knowledge to implement a DC project. The best implementations feature a cohesive and dedicated team charged with managing the project from early design through to completion.
A Cautionary Tale About Warehouse Design
I thought I’d add the following tale to demonstrate just how easy it is to make warehouse design mistakes. The subject of this tale is a company that failed to consider principles 3 and 4 correctly. Their decision impacted the efficiency of one of their largest distribution centres for its entire lifespan.
What makes this story interesting is the fact that the company (a global brewing enterprise) commissioned two almost identical distribution centres for construction at the same time. The warehouses were to hold two types of beer. One type required cold storage to maximize shelf life, while the other type was pasteurized and hence, had a much longer life.
Though the main structural design for both warehouses was identical, the regional management teams responsible for each, was given a free hand to design the interior layouts, including the exact location of the internal cold storage rooms. Because of the twinning aspect of the project, the effects of design decisions were especially clear, discernable by comparison of post-implementation performance.
A Tale of Two Cold Stores…
The cold stores were large, consuming around a fifth of the total warehouse footprint, and would have large entrances for forklift access and egress.
One team chose to locate the cold store in a corner of the warehouse, with a single door for access. The other team viewed a cold store with large doors at either end, located right in the center of the warehouse as more efficient for pallet handling. One door would face the receiving end of the warehouse, and the other would face the dispatch area, which certainly sounds like an efficient approach.
However, it proved not to be the case. After the warehouses began operating, it became apparent that internal design choices brought very different results for each of the regional operations.
The team that chose the centrally located cold store experienced higher labor costs. This was because although cold store access and egress routes were efficient, the volume of cold-stored beer was considerably less than that of the products that could be stored at ambient temperatures.
…And Two Very Different Outcomes
Worse still, over time, cold-stored product volumes began to decline as changes arose in the company’s retail and wholesale market. The centrally located cold store effectively became a large, immovable obstacle occupying prime space that could otherwise be used for pick faces for fast-moving products, which is precisely how the equivalent space was used in the other warehouse.
With the fridge in the warehouse centre, picking/put-away routes had to go around it, lengthening travel distance/time to an extent that demanded a larger workforce than the sister warehouse.
Just to add insult to injury, the centrally located cold store also cost more to operate, as two specialised air dams were required to stop cold air escaping from each of the two doors, while the cold store in the other warehouse had only one door and hence, one air dam.
The Takeaway from This Tale
If there is a moral to this cautionary tale, it is that when designing warehouses, especially those that will perform multiple functions, it pays to treat the process a little like a chess game, and think about all the ramifications of each potential design decision before committing to it.
It is easy to make mistakes, and once made, they can be very costly. That’s why I can’t recommend strongly enough that you engage external help, preferably from a design or consulting company with a strong reputation and successful record of build projects across a range of industrial domains.
A Bonus Tip to Take Onboard
Well, that concludes this article on distribution network and warehouse design principles. I trust that you will find it useful, and that your enthusiasm for the design process will be sparked or invigorated. However, there is one more design tip that I would like to share.
Please be mindful that the design of warehouses generally flows from the inside out, not from the outside in. In other words, design the materials handling system before the building.
This is most important to remember when dealing with architects and construction companies who are well qualified at ensuring the best construction and décor of a new building, but not necessarily at designing the best materials handling operations.
Bringing It All Together
What strikes me most when looking at network design and warehouse design side by side is how the same themes keep surfacing. Data quality matters at both levels. Objectives need to be clear. Simplicity is valuable but hard to maintain. And in both cases, the decisions you make early on will constrain you for years.
The connection between the two is worth emphasising. Your network design determines how many facilities you need and where they should sit. But those high-level decisions cascade down into very practical questions: What throughput does each warehouse need to handle? What storage modes make sense? How should goods flow through each facility?
If you’re designing a new network, you have the luxury of working through both levels simultaneously. If you’re optimising an existing operation, you might need to work within constraints that were set years ago. Either way, understanding these principles gives you a framework for making better decisions.
For a Better Distribution Network, Design for Success
While any logistics professional involved in distribution network design would naturally strive to achieve the best possible results, the success factors discussed in this article, for one reason or another, often get overlooked in the design process or simply don’t receive enough emphasis.
To sum up then, and help you keep these “golden rules” in mind, your chances of designing a distribution network that supports your enterprise and its customers effectively, and serves you well into the future (but remember to reassess the design from time to time and adjust for changes in market conditions), will be enhanced by a focus on the following:
- Attention to the quality and detail of data analysis
- Clarification of both primary and secondary objectives of the network
- Simplicity wherever feasible
- Building scalability into the network design
- The importance of inventory optimisation
- The value of sustainability
From Tips to Hands-On Help – Warehouse Design Services From Logistics Bureau
That’s all for now dear reader… I wish you all the best in your pursuit of high-performance warehousing operations. Of course, if you should need some help with a warehousing project, the team here at Logistics Bureau is ready and waiting to get involved.
Our warehouse design services cover the entire spectrum, from advice and help with MHE selection and procurement, through design, layout, and operations audits, to planning and interior/exterior design of new warehouses and warehouse layout optimisation.
In fact, whatever your warehouse design concerns or requirements may be, our team can help.
For a more detailed overview of what we do, please stop by our warehouse design services page, where you’ll also find details of how to get in touch and arrange a FREE initial consultation.
