The ability to effectively estimate and report the cost per square foot of a warehouse is essential for financial planning, logistics planning, and inventory planning. Several factors must be taken into account while determining these charges. It can be difficult to collect this information, but it is necessary for a company to understand its true costs and profits and determine where adjustments can and should be made. So, I will assist you if you are intending to build or renovate your warehouse and are unsure of how to calculate warehouse costs.
Check out the warehouse for sale on NoBroker here Get end-to-end assistance in buying a warehouse with NoBroker Buyer Plans How to calculate warehouse space cost?There are a few factors to think about when figuring out warehouse cost calculation;
You should take measurements of the warehouse's outer walls. This must apply to every area of the building, which is the warehouse, for which you are paying rent. The warehouse's square footage should then be calculated.
Go through the financial records to learn what expenses the warehouse had during the last 12 months. Add the cost of utilities, security contracts, the rental rate for the facility, and any additional charges for services like janitorial or gardening. Payroll costs should be included together with any employee benefits, such as health insurance, contributions, and taxes. Add the cost of insurance as well as the cost of equipment like forklifts, copiers, computers, and automobiles. Add to this list any additional expenses the warehouse experienced during the time frame. To determine the annual cost of operating the warehouse, tally up the totals after all the data has been gathered.
The overall costs incurred by the facility are subtracted from the warehouse's square foot. This information can be used to compare the costs of new and used facilities.
Make another storage expense calculation. The total number of units shipped during the last 12 months plus the total number of units currently stored in the warehouse. By dividing the total warehouse expense by the units handled, you will arrive at a warehouse storage expense. With this number, you can see where you can make improvements, how profitable you are overall, and how changes to the cost per inventory unit will affect you.
This is all you need to be aware of regarding the cost per square foot warehouse.
I’d like to conclude my answer here about how to calculate warehouse costs. I hope this helps:)
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How To Calculate Warehouse Cost?
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2023-03-05T08:09:28+00:00 2023-03-06T12:10:27+00:00Comment
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