* Is High or Low Best: Higher is Better
Peak Warehouse Space Utilization measures the efficiency with which the warehouse uses its inventory storage capacity during its busiest seasons. Low values for this KPI may suggest that the warehouse is too large, inventory is being stored in improper places, demand forecasting is not accurate, inventory replenishment processes are slow or that managers are not properly adjusting to peak seasons. Low Peak Warehouse Space Utilization is going to be costly to the company due to facilities, overhead and utilities costs that are not being used to generate revenue. Companies that do not make the most of their warehouse space also risk having stock-outs for customer orders.
The amount of warehouse capacity being used (measured in square feet) during peak seasons divided by total warehouse or facility capacity, as a percentage.
Two values are used to calculate this KPI: (1) the amount of warehouse space being used (measured in square feet) at the time of measurement, and (2) the total warehouse or facility space/capacity. Warehouse space is in use if it is storing goods/materials for future shipment at the time of measurement. Only include floor space in this calculation. Do not include cubicle space in this calculation. Only include measurements that occur during what the company defines as its peak seasons in this calculation.
(Amount of Warehouse Space Used / Total Warehouse Space) * 100
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