Glossary
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Example H2
Supply Chain Glossary
INCOTERMS
ISO 14083
Import duty
In-gauge cargo
Inbound logistics
Inbound visibility
Inland transport request
Intermodal transportation
International Convention for Safe Containers (CSC)
International Maritime Organization (IMO)
Inventory turnover
LCL Freight
Last mile delivery
Late submission
Laytime
Lead logistics provider (LLP)
Less-than-truckload (LTL) freight
Letter of indemnity
Load / discharge confirmation
Load / loading of container
Load board
Load list
Load optimization
Load tender
Logistics 4.0
Logistics document management
Logistics route optimization
Logistics service provider
Logistics visibility
Manifest corrector
Marine insurance
Maritime Mobile Service Identity (MMSI)
Master Bill of Lading (MBL)
Material Requirements Planning (MRP)
Merchant haulage
Minimum Order Quantity (MOQ)
Multimodal transport
Neopanamax Ship
Network / vessel capacity
Non-Vessel Operating Common Carrier (NVOCC)
Off dock storage
On-time in-full (OTIF)
Order accuracy
Order lead time
Out-of-gauge cargo
PAPS number
PARS number
POD (Port of Discharge)
POL (Port of Loading)
Packing list
Panamax Ship
Port
Port call
Port congestion
Port of Entry (POE)
Port pair
Post Panamax Vessel
Re-export
Real-time transportation visibility (RTTV)
Reefer container
Release reference number
Reverse logistics
Roll-on/Roll-off (RORO) shipping
Route plan
SCAC Code
Safety stock
Sanctions screening
Scope 3 emissions
Sea Waybill
Seal
Shipment
Shipment visibility
Shipper
Shipping Alliances
Shipping Instruction
Shipping lanes
Shipping manifest
Short shipment
Slotting
Special cargo
Special equipment
Stockout
Stowage
Supplier risk management
Supply chain 3.0
Supply chain 4.0
Supply chain automation
Supply chain collaboration
Supply chain control tower
Supply chain data
Supply chain finance (SCF)
Supply chain network design
Supply chain resilience
Supply chain risk management
Supply chain traceability
Supply chain visibility
Supply planning
Terminal
Terminal departure report (TDR)
Terminal move
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Warehouse utilization

What is Warehouse Utilization?

Warehouse utilization is a logistics KPI that refers to the effective use of available warehouse space for storing goods and inventory. It measures how well the storage capacity of a warehouse is being used relative to its total capacity. High warehouse utilization means that space is used efficiently, maximizing storage and minimizing wasted areas. Effective warehouse utilization is crucial for reducing operational costs, improving inventory management, and ensuring smooth logistics operations.

How to Calculate Warehouse Space Utilization

To calculate warehouse space utilization, divide the total amount of space used for storage by the total available warehouse space and multiply by 100 to get a percentage.

For example, if a warehouse has 10,000 square feet of total space and 7,000 square feet is utilized for storage, the utilization rate is (7,000 / 10,000) * 100 = 70%.

What is the Optimal Warehouse Utilization Rate?

The optimal warehouse utilization rate varies depending on the type of goods stored, the layout of the warehouse, and operational needs. Generally, a utilization rate between 70% and 85% is considered efficient, allowing for adequate space for operational activities like picking, packing, and movement of goods. Excessively high utilization rates can lead to congestion and operational inefficiencies, while lower rates may indicate underused space and potential opportunities for consolidation.

How to Improve Warehouse Space Utilization

To improve warehouse space utilization, start by analyzing and optimizing the layout and storage systems to better accommodate inventory. Implementing high-density storage solutions, such as vertical racking or automated shelving, can help maximize space. Additionally, regularly reviewing inventory levels using cycle counts or other methods, and adjusting storage practices based on demand patterns can prevent overstocking and ensure that space is used efficiently. Leveraging technology, such as warehouse management systems (WMS), can also enhance space planning and improve overall utilization.