Reorganisation Saves A Company $300,000 per annum!!!
A large direct marketing distribution business operated from 3 warehouses within the one complex. Two of the warehouses were adjoining and the third was at the end of the complex. When the lease renewal of the remote warehouse was approaching, it was time to consider their options.
The third warehouse was costing $200,000 per year to lease, plus the capital costs of the pallet racking, forklifts, extra staff etc, the total costs were over $400,000 per year. With the remote location of the warehouse, supervision of staff was also a problem.
After careful analysis, it was determined that they could modify some of the racking in their two adjoining warehouses to maximize the use of the storage space available, and then to contract out the storage of the remaining stock which is used much less often, they would save over $300,000 per year with A Class Warehousing