There are many reasons for the construction or expansion of a warehouse, which may include meeting the growing needs of the business, entering new markets, avoiding obstacles, and replacing old and soon obsolete equipment. Here are 10 best practices to know about building or expanding a warehouse.
1. See the numbers you require to explain the project
The feasibility of major upgrades depends on the exact number and any budget must be prepared by the IRR. Manufacturers should see if it is possible to achieve positive returns even with conservative numbers that can do anything to fire with surprise. IRR’s ideas include location, ownership, equipment, construction, and life span.
2. Give yourself enough time
Designs always take longer than expected and being honest about the process can overwhelm the way. It takes the right time to do it. Do not be quick to decide the equipment vendor, or forget about the factor of a learning curve for a new process or equipment.
3. Decide renovation or construction
Deciding whether to rebuild or build is always a difficult decision and it is important to pay more attention to the budget. Sometimes renovating an existing space may not be in your best interest, even if the cost is low in the short term. While with most real estate transactions, the decision normally comes down to “location, location, location”. Asking the next questions can help make the choice easier:
- Wherever do we want to be for workers, suppliers, and clients?
- Where is the best use of interstate?
- What is the cost of putting in rail?
- Where can I create to make the best tax rate?
4. Think about maximizing square footage and space
The first thing you need to see is the cost of the square footage. For industrial locations, it is typically $ 85 per square foot. Any empty square feet puts you and your customer at a disadvantage. The next question is how fast can I move the inventory through the building. A rule of thumb is the policy of commissioning finished goods in more than two weeks and not keeping a list for more than 90 days.
5. Involve each stakeholder
Involve every stakeholder inside and outside the company to prevent any fires from burning your budget. At the end of the design period, there should be a consensus that prevents major issues such as incorrect equipment layout from occurring. When there is no trading, you have a guarantee that problems will occur. This includes contacting city officials about your plans. Approve the city quickly and discuss the number of jobs that will be created. This action enables you to rotate the permit very quickly.
6. Seek outside help
The most important thing to remember is that maintaining these projects is a full-time job and most people now have full-time jobs. So, hire a dedicated project management team or somebody to assist you. Some people will specialize in the design and construction side; Some people have connections with city officials. Use the product management team, even if that team is the property manager who leases the building.
7. Mobilizing the team
Investing on this scale is more notable when you have a team you can trust. It is one thing to have new equipment, but it is the team that makes the difference. It comes to develop a good work culture that promotes entrepreneurship, smart decision making, and learning at work.
8. Take your time with the latest technology
When it comes to choosing the right machine timing matters. What will be possible in the next year will be changed, and many factors have to be held, including automation possibilities, installation and process times, and strong manufacturing best practices.
9. Wait on contractors
It is important not to run with authorized merchants to save time or money. Added benefits Some new contractors may have the motivation to do a good job so that they have different equipment or product development opportunities. This is an opportunity for them and in the meantime, your company gets the best value, technology, and capability.
10. Don’t forget your existing customers
When building a new location, it is important to think about your current customer base, so that you don’t lose a single one in the process. Focus on communicating very quickly and correctly. Outsourcing to other locations or partner processing companies will help protect you from losing any customers.
What you should know about calculating costs when renting a warehouse?
Cost while renting a warehouse
Warehouses come in all shapes and sizes, and the cost varies by a wide margin depending on the location you require and the services you employ.
The obstacle is, calculating the monthly cost of contract space before signing on the dotted line is not ever simple. This is particularly true with many landowners and brokers who describe their rates and fees using deceptive terms rather than direct language.
This guide describes what to expect regarding costs associated with renting warehouse space.
When relating to warehouse properties, it is important to ask the best questions to get an accurate view of the monthly rent from the owner to be sure to ask:
- Who is responsible for performance and payment for maintenance?
- Who is liable for making and paying for the renovations?
- Who is responsible for replacing the equipment connected to the warehouse, such as an HVAC unit?
- Do I only have to pay for the actual square footage of a common area or location?
- Do I need to install a signal?
- Is the landlord willing to pay for any tenant improvements?
You are not responsible for such expenses after signing the contract, it is important to know the answers to these questions quickly. Should something go wrong that you are responsible for repairing or replacing, your budget can be increased immediately.