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Blog cover image of team members in a warehouse, for blog of essential factors to consider choosing a warehouse
RouteiqueOct 22, 2021 3:22:00 PM5 min read

Warehouse Optimization: Essential Factors to Consider When Choosing A Warehouse Location

What Should You Consider When Looking for Warehouse Space?

With the cost of warehouse space rising in many markets, it's essential to make the most out of any expansion. 

Key Takeaways:

  • Choosing whether to grow or optimize your warehouse requires careful analysis based on a number of factors

  • When choosing a new location, consider proximity to key suppliers, customers, workforce, accessibility to transportation
  • When purchasing a warehouse, consider factors like access to internet to support technology used on-site, room for future growth, and energy efficiency


Essential Factors to Consider

Recent news pieces have covered warehouse space shortages in many markets. This includes areas in Canadasurges in warehouse space near US ports as imports surge, and general shortages across North America as giants expand their footprint. This has led to a rise in warehouse costs a number of regions. A range of sources from The Wall Street JournalCanadian news networksWarehousing and Fulfillment, have reported on this in more depth.

Because of this, distributors seeking new warehouse space have to take into account more than just the usual criteria for expansion. With the costs of space rising, getting the right space for your needs is more important than ever. It's also important that when you choose a new space, you can get the most out of it.

Here are key steps and factors to consider and steps to take when choosing a new warehouse location.


Determining the Best Option:
Optimize Your Existing Warehouse, or Grow?

With warehouse space at such a premium in many markets, it can be beneficial to determine whether moving to a new location truly is the course of action for growing your operation.

Other options can include:

In our experience, clients find success when they consider the following:

  • Forecasted growth
  • Upcoming changes to processes
  • Infrastructure and technology
  • Customer locations and requirements
  • Ideal product mix



Choosing Your Location: Key Considerations

If you and your team decide that opening a new location is the best option, there are a number factors to consider when choosing a new warehouse.

Here is our team’s rundown of a few of the most important ones .



When deciding on a warehouse location, it’s important to take into account multiple factors.

Proximity to Key Suppliers

Geographically, it can be helpful to start broad and analyze your entire network. If you have suppliers clustered in a specific area, it can be beneficial to open a warehouse in a location that can easily receive their goods and flow it into the rest of your network.

For example, if you are an American company with a supplier in the UK, you will likely want at least one warehouse located on the eastern seaboard.

Proximity to Customers

Choosing a warehouse location close to your customers can help reduce last-mile struggles. The COVID-19 pandemic has led to an increase in e-commerce and home delivery. Many B2C retailers have leveraged dark stores or micro-fulfilment centres closer to end customers for more seamless delivery.


Another element to consider is workforce. According to Global Trade Mag, “One of the biggest problems facing the warehousing industry today is the shortage in warehouse workers. Prior to the pandemic, it was estimated that the warehousing industry needed to fill roughly 450,000 jobs. Since then, the shortage has dramatically increased.”

Depending on your business, it may be beneficial to consider how easily you will be able to recruit and retain talent in your chosen area.

Accessibility to Transportation

Once you’ve settled on the region and general location for a warehouse, looking at the specifics is essential.

  • Is the warehouse easily accessible via major arterials or highways?

  • Will carriers or delivery drivers be able to easily access your location, or will they be fighting traffic snarls and delays?

  • Similarly, the need to be close to key suppliers works on a micro level as well: how close is your location to ports and airports?



Infrastructure and Layout

Once you’ve settled on a specific warehouse region, there are additional criteria to consider. Some of these have made a significant impact on our clients' choices and plans for their new warehouse locations.

Internet Access to Support Technology Used On-Site

While it may seem obvious to look for more significant features, like sufficient freezer space for frozen food, or the right number of bay doors, there is one often-overlooked feature that clients of ours have discovered is incredibly important.

If you are using, or plan to use, technology to support your warehouse optimization, affordable access to the internet is essential.

‘We’re hearing more and more businesses finding their ideal new space only to move in and have challenges bringing internet into the building,” says VP Client Services Kaitlin Mercier, “It’s so important that this becomes a key criteria for evaluating space so businesses can move in and immediately rollout their WMS solution.'

To ensure you are up and running as quickly as possible after a move, be sure to factor this into your planning.

The Ability To Meet Your Unique Business Needs

Scale 3D Modelling for Layout Modelling Warehouse Space Optimization

Another way to ensure a warehouse is the right fit is leveraging a digital twin 3D model.

This is an affordable way to pre-visualize what the warehouse will look like when your organization and equipment have moved in.

Using this digital twin, it’s easy to test and experiment with different warehouse configurations.

This ensures that the initial setup is the right one, and that the new warehouse space meets your current and future forecasted space requirements.

Ability to Meet Customer Needs

Another factor when it comes to modelling your new warehouse location is your customer needs. By carrying out a deep dive into your data, our customer service experts can suggest changes to how products should be organized to achieve maximum efficiency.

Room for Future Growth

In addition to making sure that your warehouse fits your current needs, is important to consider future plans for your business.

This might include:

  • Looking at how easy it is to expand to additional space in the same area

  • Examining whether or not the location will need new upgrades over time

Energy Efficiency

Many new or retrofitted energy-efficient buildings can use significantly less water and power than one that meets minimum standards. This can be especially true for warehouses in the foodservice space which make use of freezers, .


Putting It All Together

To learn how to make the most of your space once you’ve acquired it, check out our blog on how to optimize your warehouse space and reduce costs with the right tools

Or, you can read more about finding the right tools for your needs and how they can help facilitate an efficient and cost-effective warehouse operation.