The Do’s and Don’ts of Designing and Building a New Warehouse

1. Do conduct a thorough needs assessment

• Understand your requirements: Before starting the design process, conduct a comprehensive needs assessment. What is your supply chain strategy and how will it support the Business Strategy and Customer Proposition?
• Data requirements: Understand the types of products you will store, their volume and material flow, route to market, turnover rate, and specific handling requirements.
• Location: Understand your centre of gravity to optimise the supply chain. Where does the inbound volume come from? Where are your customers and what is the route to market? What is the local labour market like in terms of availability and cost?
• Options development: Develop options based on an end-to-end cost to serve evaluation, covering location, type of operation, and solution testing allowing for different growth scenarios.

2. Do prioritise an efficient layout of your warehouse

• Flow Optimisation: Design the layout to optimise the material flows and minimise travel time through the site. Then design the process flows to reflect the layout.
• Phasing and Flexibility: Understanding how the operation will grow and change over its lifetime will enable you to phase the investment required over time to improve the ROI.
• Day in the Life Of (DILO): Make sure you map the DILO for the operation to understand potential bottlenecks, impact of shift changeovers and to identify different areas where activities should take place and when. This should include indirect activities such as arriving on site, location of welfare facilities and security arrangements.

3. Do invest in technology

• Warehouse Management System (WMS): Implement a robust WMS to track inventory, manage orders, and optimise storage locations. Find out more here for our top tips on a successful WMS implementation https://hatmill.com/insights/top-10-tips-for-a-successful-wms-implementation/
• Automation: Consider incorporating automated equipment to further optimise your operation, such as conveyor systems, automated storage and retrieval systems (ASRS) or robotics. This consideration must be part of the Needs Assessment phase to ensure the building interface requirements reflect the operational solution. Ensure the building has adequate power supply, data connectivity, fire protection, and ventilation to support future plans. Read more here on warehouse automation.

4. Do ensure safety and compliance

• Regulatory Compliance: Understand and adhere to all local and national regulations regarding planning, building requirements, fire safety, and occupational health standards. Remember that devolved administrations can have different regulations so requirements will vary across regions.
• Safety Measures: The warehouse should have safety as the number 1 priority. Include features such as fire suppression, proper lighting, clear signage, safe walkways and emergency exits.
• Engage the Experts: Ensure that the design meets the highest standards of health and safety. Consult with Building Control, Fire Engineers, and Principal Designers to identify and mitigate any potential risks and hazards.

5. Do plan for environmental sustainability

• Energy Efficiency: What sustainable warehouse solutions have been considered for the fitout and operational phase of the DC? Incorporate energy-efficient lighting, heating, and cooling systems. Use renewable energy sources where possible.
• Sustainable Materials: Choose environmentally friendly building materials and consider green building certifications such as BREEAM or LEED.
• Choose The Right Developer: Most if not all Developers have environmental sustainability credentials. However, these should be checked and compared with other Developers in the market. Make sure you have a clear contract that specifies the expectations and responsibilities of both parties regarding the sustainability aspects of the project.

6. Do have an Experienced Project Manager

• Managing the build process: Co-ordinate the multiple stakeholders; have a design change and approval process; manage the budget; ensure there is rigorous governance in place.
• Fitout Procurement: Understand the critical path for fitout item lead times and installation; make sure you benchmark costs and providers for best value; manage your suppliers and co-ordinate their deliveries and installations on site.
• Managing the budget: The long term nature of these projects inevitably impacts the project – plans and designs change, multiple stakeholders will have inputs etc. Ensuring there is tight budgetary control and suitable contingency funds is essential.

The Don’ts

1. Don’t underestimate the time it takes to deliver a new warehouse

• Do allow enough time to do it properly: Many companies don’t give themselves enough time and get forced into a business decision which tends to be a compromise. Don’t wait until there’s only 12 months on your current lease, or capacity, before starting the process.
• Skipping Detailed Planning and Specification Review: Avoid rushing the planning and design phases. Once the specification is signed off, any changes will be costly during construction, or you could be faced with operational inefficiencies.
• Ignoring Stakeholder Input: Failing to involve key stakeholders, such as warehouse colleagues, operational leads, systems professionals, H&S and ESG team etc, can result in a design that doesn’t meet the operational and organisational needs.

2. Don’t neglect space utilisation

• Inefficient Space Use: Avoid underutilising vertical space. Implement high-bay racking systems and mezzanines to maximise storage capacity.
• Overcrowding: Conversely, avoid trying to cram too much into the space. Ensure there is adequate room for volume throughput and manoeuvring equipment and people – storage is only part of the operation.

3. Don’t overlook flexibility

• Rigid Design: Avoid designing a warehouse that cannot adapt to changes. Incorporate flexible storage solutions and modular designs to accommodate your evolving needs.
• Single-Purpose Areas: Design multi-functional areas that can be repurposed as requirements change over time.

4. Don’t forget about people

• Poor Ergonomic Design: Ignoring ergonomic principles can lead to worker fatigue and injuries. Design workstations, picking areas, and packing stations to minimise physical strain.
• Neglecting Employee Welfare: Provide facilities such as a good canteen, adequate toilets, break out space and adequate ventilation to ensure a place people want to come to work.
• Culture: A shiny new warehouse is only as good as the people and culture in it – it takes more than a pool table and discounted coffee to drive a great culture!

5. Don’t cut corners on quality

• Professional advice: Engage the services of an experienced professional team to fulfil the difficult balance between programme, cost and quality or design integrity.
• Inadequate Training: Ensure there is a Facilities owner who is well-trained in using and maintaining the new building systems and equipment.

6. Don’t operate in a silo, engage the business in the project

• Stakeholder Engagement: Identify the key stakeholders in your organisation who have the expertise, experience and influence to lead the process. Engage them from the start and involve them in every stage of the process, from defining the objectives and criteria, to developing and evaluating the options, to planning and executing the transition.
• Failing to communicate regularly and effectively with internal stakeholders: Communicate clearly and frequently with your organisation and solicit their feedback and input. Ensure they are aligned with the vision and goals of the project and are committed to its success.
• Siloed Systems: Avoid implementing standalone systems that do not integrate with your existing technology. Ensure seamless integration with your enterprise resource planning (ERP) system, order management system, and other software.

Conclusion:

Designing and building a new warehouse is a significant investment that requires time and meticulous planning and execution. By following these do’s and don’ts, you can create a warehouse that is efficient, scalable, and adaptable to future needs.  A well-designed warehouse is not just about maximising space but also about optimising processes, ensuring safety, creating a platform for growth and creating a great place to work for your colleagues. Find out more here about how Hatmill can help you when considering a new warehouse.

¹ Savills Big Shed Briefing, July 2024