Cold Storage Warehouse Challenges
Cold storage offers some unique challenges that are often amplified from those faced by dry goods facilities. The most difficult to overcome is related to costs associated with operating cold storage facilities. The two biggest places where warehouses or their third-party logistics (3PL) providers can save money is in energy consumption and labor. Compact mobile carriages are an easy and cost-effective solution to reduce labor, energy, and space costs in cold storage with a quick return on investment.
Energy and utilities are among the greatest operational expenses for cold storage warehouses. Since 2004, the cost of energy has increased by 33% and will only continue to get higher in the years to come. Additionally, cold storage is three times more energy intensive than standard warehousing. Even just a seemingly small difference between the energy use of a standard warehouse at 1.54 kWh/ft³ and an energy-conscious warehouse at less than 0.60 kWh/ft³ (with the average price of electricity at $0.07) means $9,900,000 verses $3,600,000 in energy costs.
Labor costs are the second-largest concern for a cold storage warehouse. 70% of overall costs go to labor. Value-added services such as repack operations, manufacturing, or consolidation increase a warehouse's competitive advantage, but these services are often unable to be provided due to high labor costs. On top of that, 20% of warehouse workers are actively disengaged from their work, costing warehouses $7.60 per hour. Increasing labor productivity by just 10% can afford cold storage warehouses $150,050 in labor savings per year.
Solution: Compact Mobile Carriages in Cold Storage
Compact mobile storage can create significant cost savings for labor and energy operations and many other benefits.
- Save Space: Most freezer/cooler environments cost $200/sq. ft. to construct and additional capital to operate. Compact mobile carriages can create up to 50% more storage space in the same footprint as static racking, eliminating the need to build or rent extra space.
- Use Existing Racking: The compact mobile carriages are designed to be used with new or existing pallet racks and/or heavy-duty static racking, saving you on costs even further.
- Compact mobile carriages are designed with withstand temperatures as low as -4°F with stainless steel available for temperatures below -4°F.
- Densely-packed coolers mean decreased energy, and doubling the number of pallet positions in the same space can reduce air escape and lower utility bills by as much as 50%.
- Compacting inventory also means reduced labor costs. Average order-pickers walk anywhere from 7-13 miles per shift. The less a product is moved or touched, the fewer costs are associated with and the less time an employee has to travel to pick inventory.
- Providing 100% accessibility and visibility to stored materials in less space eliminates long travel times and unnecessary movements.
- More space for value-added activities such as kitting, repacking, labeling, and fulfillment services
- Promote a clean environment and move closer to achieving lean 5S in your warehouse (sorting, straightening, shining, standardizing, sustaining).
Contact Us for Compact Mobile Carriages
Southwest Solutions Group® provides design and installation services for compact mobile carriages to reduce labor, energy, and space costs in cold storage warehouses. We will also provide you with a free consultation to determine your exact needs and specifications before the design process begins. To learn more or to speak with a specialist, call us at 1-800-803-1083 or send us a message today.