Warehouse floor space is one of the most expensive fixed costs in manufacturing: rent or building upkeep, heating, lighting, property taxes. When space runs out, the usual answer is to expand. There is another way: store the same amount of goods on a much smaller footprint by using building height and automation. This article skips the generalities and gives a clear calculation: how savings of up to 90% are achieved, what they depend on, and when they are out of reach.
Table of contents
- Why an automated warehouse needs less space
- The space savings formula
- Worked example: 300 pallet positions
- What the space savings are worth
- What affects the result and when 90% is unrealistic
- Benefits beyond floor space
- Which type of automated warehouse to choose
- FAQ
Why an automated warehouse needs less space
A conventional warehouse loses floor space on three fronts:
- Height. Floor storage and forklift warehouses rarely use more than 4–8 m of height. An automated warehouse with a stacker crane or vertical lift modules works at 12–20 m and above.
- Aisles. In a conventional warehouse, 40 to 60% of the area goes to aisles and forklift maneuvering. An automatic stacker travels on a rail and needs no turning allowance, so its aisle is minimal.
- Storage density. Automation allows tighter placement: smaller gaps in width and height and, in some systems, deeper storage.
It is the combination of these three factors that produces savings in the range of 70–90% of storage floor space.
The space savings formula
Three steps are enough for an estimate.
- Conventional warehouse area: Sconv = (positions ÷ storage levels) × area per position × (1 + aisle factor).
- Automated warehouse area: Sauto = rack block length × rack block width (including the crane aisle) + receiving and picking area.
- Savings: (1 − Sauto ÷ Sconv) × 100%.
Worked example: 300 pallet positions
Take a typical task for an engineering plant: storing sheet metal, bar stock and components on 1.5 × 3.0 m pallets, 300 positions, up to 1 t per position.
Assumptions
- One storage position measures 1.5 × 3.0 m (4.5 m²).
- Conventional warehouse: pallets stacked 2 high on the floor; aisles and maneuvering space equal 100% of the storage area.
- Automated warehouse: a double-sided rack block with a single stacker crane aisle, 1.0 m vertical pitch, 1.55 m bay pitch, and a block width of 8.2 m (two 3.0 m rows plus a 2.2 m aisle).
- Receiving, buffer and picking area for the automated warehouse: 30 m².
Step 1. Conventional warehouse
300 positions ÷ 2 levels = 150 storage spots × 4.5 m² = 675 m². Aisles and maneuvering add another 675 m². Total: Sconv = 1,350 m².
Step 2. Automated warehouse, two rack heights
Option A: 12 m racks (12 levels). 300 ÷ 12 = 25 positions per level, which is 13 bays across two rows. Block length: 13 × 1.55 m ≈ 20.2 m. Block area: 20.2 × 8.2 ≈ 165 m². With the receiving area: ≈ 195 m².
Option B: 16 m racks (16 levels). 300 ÷ 16 ≈ 19 positions per level, which is 10 bays across two rows. Block length: 10 × 1.55 m = 15.5 m. Block area: 15.5 × 8.2 ≈ 127 m². With the receiving area: ≈ 157 m².
Step 3. Comparison
| Parameter | Conventional warehouse | Automated, 12 m | Automated, 16 m |
|---|---|---|---|
| Storage positions | 300 | 300 | 300 |
| Levels | 2 | 12 | 16 |
| Floor area, m² | 1,350 | ≈ 195 | ≈ 157 |
| Space saved, m² | — | ≈ 1,155 | ≈ 1,193 |
| Space saved, % | — | ≈ 86% | ≈ 88% |
Here is where the effect comes from. Of the 1,350 m² in the conventional warehouse, 675 m² is aisle space. The automated warehouse removes almost all of it and, at the same time, multiplies the number of levels by 6 to 8. If the building allows even taller racks, or the comparison is with a warehouse that has wider aisles (for example, for long loads), the result approaches the 90% mark.
What the space savings are worth
The 1,155 m² freed up either avoids renting or building, or can be handed over to production. To estimate the value, plug in your own cost per square meter.
Illustrative calculation (the rate is an assumption, replace it with yours): at an upkeep cost of $6 per m² per month, the freed 1,155 m² amount to 1,155 × 6 × 12 ≈ $83,000 per year. If you are instead avoiding the construction of a new building, base the saving on construction and utility connection costs.
For a full payback estimate, compare these savings with the cost of equipment, WMS, installation and maintenance, and add the benefit of fewer errors and faster picking (see below).
What affects the result and when 90% is unrealistic
“Up to 90%” is an upper bound, not a guarantee. The result depends on:
- Building height. With a 6–8 m ceiling the height effect is limited. The gain then comes mainly from narrower aisles, and savings are closer to 50–70%.
- The baseline. Comparing with floor storage gives a higher percentage than comparing with an already optimized racked warehouse.
- Product range. Many odd-sized loads reduce packing density; uniform pallets and trays give the maximum.
- Throughput. Very high throughput requires more aisles and cranes, and the footprint grows.
- Floor and structural loads. A high-bay warehouse needs a solid foundation and frame.
So the accurate way to put it: for a specific plant, savings are determined by calculation, and “up to 90%” is what is realistically achieved with high ceilings and dense, uniform loads.
Benefits beyond floor space
- Speed and accuracy. The “goods-to-operator” principle eliminates walking around the warehouse and sharply cuts picking errors.
- Real-time records. A WMS knows what is stored where and integrates with ERP and MES.
- Safety. No forklifts and people sharing the same space, and less cargo damage.
- Material protection. Sheet metal and expensive blanks are stored without damage or corrosion caused by deformation and repeated handling.
Which type of automated warehouse to choose
The system type depends on the load and the task:
- Rack-type automated warehouses with a stacker crane for palletized loads, large storage volumes and tall buildings.
- Lift-type warehouses are compact systems for small and medium loads where density and delivery to the operator matter.
- Automated sheet metal warehouses (VerMet) for storing sheets and blanks with delivery directly to the cutting machine.
Techvagonmash designs and manufactures automated warehouses, including the VerMet sheet metal storage systems and the TL series of rack-type and lift-type solutions, and covers the full cycle: from calculation and design to installation and integration with your management systems.
Want a calculation for your warehouse? Send us your product range, load dimensions, required number of positions and building height, and our engineers will calculate the footprint, compare options and estimate payback. Contact Techvagonmash.
FAQ
How much floor space does an automated warehouse save?
Typical calculations show 70 to 90% compared with floor storage or a forklift-served warehouse. The result depends on building height, product range and the baseline. In our 300-pallet-position example the saving was 86–88%.
How do you calculate the footprint of an automated warehouse?
Divide the number of storage positions by the number of levels to get positions per level, then work out the length and width of the rack block including the stacker crane aisle, and add the receiving and picking area.
Does an automated warehouse always pay back through space savings?
No. The effect is greatest when floor space is expensive or scarce and the building allows high-bay storage. A payback calculation should include equipment, software, maintenance, and the benefit of faster, more accurate picking.
What other benefits does an automated warehouse offer besides space savings?
Fewer picking errors, fast search and retrieval, real-time stock records through a WMS, independence from the human factor, and safer operation without forklifts.