Warehouse Design: Common Layouts and Tips for 2024

A well-designed warehouse layout can be the difference between profit and loss in retail. Imagine cutting pick times in half or doubling your storage capacity without expanding your footprint. These aren't pipe dreams—they're real outcomes of smart warehouse logistics and design.

A smart warehouse layout makes the most of every square foot. The goal is to fit more inventory without overcrowding, which can slow down operations.

Ahead, learn the top warehouse layout designs, practical optimization tips, and key factors to consider in your warehouse planning process.

Importance of good warehouse design

Good warehouse design is essential for efficient retail operations. The goal is to maximize space and ensure smooth workflows, which increases inventory capacity without expanding your footprint.

Effective warehouse design also improves efficiency by:

• Streamlining order picking and packing workflows
• Minimizing travel time for workers within the warehouse
• Accommodating equipment like forklifts and pallet jacks

Efficient inventory management is another objective. A smart layout helps prevent lost items and speeds up product movement through clear zoning for different product categories, intuitive labeling and tracking systems, and designs that make stock counting and inventory updates easier.

“For a long time, we didn't even keep track of our plant inventory,” says Adam Besheer, co-founder of Greenery Unlimited. “Our B2B wing and our B2C wing are in the same warehouse, and plants would just get taken from one to the other. Our maintenance team would grab plants to put in installations, and they’d just go missing. We’d have orders that required these plants, but they’d be nowhere to be found.” 

In other words, when you nail down an efficient warehouse design, the effects ripple throughout your entire business. Order fulfillment becomes faster and more accurate, your employees are more productive, and your customers are happier.

3 types of warehouse design 

U-flow 

The U-flow design, as the name suggests, follows a U-shaped pattern. Products enter via loading docks at one end of the "U" and exit at the other. It makes receiving, storage, picking, and shipping intuitive.

Storage racks often run perpendicular to the base of the "U" to maximize space and create clear aisle space for material handling equipment. You'll typically see a mix of storage types here, like pallet racks for bulk items and shelving for smaller products.

The U-flow design is good for:

• Medium to large businesses with diverse product ranges.
• Operations handling fast-moving consumer goods.
• Companies with moderate to high turnover rates.
• Warehouses managing numerous SKUs.

This warehouse design principle is good for handling a wide variety of products, especially fast-moving consumer goods with moderate turnover rates. It also offers flexibility in storage and picking strategies for medium to high-volume operations with numerous SKUs.

The level of automation in U-flow warehouses can vary. Some might use basic conveyor systems, while others could have robotic picking arms or automated guided vehicles (AGVs). The U-shape lends itself well to gradual automation upgrades, so you can start simple and add tech as needed.

I-shaped

An I-shaped warehouse layout is a simple and efficient design. Picture a long, straight aisle running down the center of the warehouse. This main aisle forms the "I" shape. On both sides of this aisle, you'll find storage areas and shelving units.

The I-shaped layout works well for warehouses that handle a limited range of products. Think bulky items like lumber, pipes, or rolled goods that benefit from straight-line material flow. Forklifts and other equipment can travel quickly up and down the central aisle, picking up or dropping off items as needed.

Warehouses use the I-shaped layout because:

• It's straightforward to navigate
• It makes good use of available storage space
• It allows for clear organization of inventory

However, this warehouse layout might not be ideal for larger warehouses or those with a wide variety of products. The linear design makes it harder to group similar products together or create separate zones for different product categories. In those cases, more complex layouts might work better.

L-shaped

The L-shaped warehouse layout forms two main aisles that meet at a right angle, creating an L shape. This design offers more versatility than the I-shaped layout. One leg of the L often handles receiving and shipping, while the other contains storage areas for raw materials or sellable inventory. 

It’s excellent for storing mixed product types and sizes, especially items requiring separate storage and shipping areas or different handling conditions. Warehouses use it for medium-volume operations with flexible throughput levels.

The L-shaped design is also good for:

• Better organization of different warehouse functions
• More efficient use of corner spaces
• Potential for shorter travel distances between areas

This design works well for warehouses that need to separate certain operations. For example, one leg might handle bulk storage while the other manages smaller, fast-moving items.

Factors to consider when designing your warehouse

Budget

Your budget is the total amount available to set up and run your warehouse. It covers costs for the building, equipment, logistics technology, initial inventory, and ongoing expenses like rent, utilities, and staff wages.

A warehouse budget typically ranges from $100,000 to several million dollars, depending on size and complexity. For a mid-sized warehouse, plan on $500,000 to $1 million to cover costs.

Available space

Available space for warehouses usually ranges from 10,000 to 100,000 square feet. The space you need depends on your inventory volume, storage methods, and growth plans. A good rule of thumb is to allow 20–30% extra space beyond your current needs for future expansion.

Flow

Flow is about how materials and products move through your warehouse from receipt to shipping. A well-designed flow reduces wasted time and effort, so your supply chain operations are more efficient.

Accessibility

Accessibility means items in your warehouse are easy to reach and handle. This might include pallet racks (usually 8–12 feet high) for bulk items, shelving units (4–6 feet high) for smaller goods, and specialized systems like vertical lift modules for storage density. It speeds up picking and makes work safer by reducing awkward or risky movements.

Throughput

Throughput measures how much product your warehouse can process in a given time period. A small warehouse might handle 100–500 units daily, while large operations can process tens of thousands. 

Improving throughput involves implementing technologies like barcode scanners or RFID systems, optimizing picking routes, and using conveyor systems for faster movement.

Personnel

Warehouse staffing needs vary widely, but a typical mid-sized warehouse (50,000–100,000 sq ft) might employ 15–30 workers across different roles. This usually includes warehouse associates for picking and packing, forklift operators, inventory managers, and supervisors. 

Staffing ratios often fall around one worker per 1,000–2,000 square feet of warehouse floor space. When planning, consider peak periods that may require 20–30% temporary staff increases to handle higher volumes.

Local guidelines

Local warehouse guidelines typically include zoning laws, building codes, and safety regulations: 

• Zoning laws often require warehouses to be in industrial or commercial areas, with setbacks of 20–50 feet from property lines. 
• Building codes may mandate specifics, such as fire suppression systems, minimum ceiling heights (often 20–30 feet), and floor load-bearing capacities. 
• Safety regulations usually require proper lighting (a minimum of 10–20 foot candles), ventilation systems, and marked emergency exits every 200–300 feet.

Warehouse layout design best practices

Define your requirements and objectives

First, it's important to define your requirements and objectives. This means figuring out what you need your warehouse to do and how it should work. 

Think about things like:

• How much inventory you'll be storing
• What kinds of products you'll have
• How fast items need to move in and out
• Any special storage areas or needs (like temperature control)

Once you know what you need, you can start planning your layout.

Optimize storage solutions

Consider how to make the most of your space. Depending on what you're storing, you might use different types of shelving or racking systems. 

For example, pallet racks work well for large, heavy items, while smaller products might do better on shelves or bins. The goal is to fit as much as possible while keeping everything accessible.

Integrate automation and robotics

The rise of warehouse automation and robotics has changed warehouse operations in recent years. Advanced technologies are enhancing efficiency across the board:

• Automated storage and retrieval systems (ASRS) maximize vertical space and quickly retrieve items.
• Pick-to-light systems guide workers to correct locations, boosting accuracy and speed.
• IoT sensors provide real-time inventory tracking and optimize stock levels.
• U-flow and L-flow layouts, combined with these technologies, minimize travel distances and improve workflow.
• Robotic sorters and pickers handle repetitive tasks rapidly, freeing up human workers for more complex duties.

These innovations collectively streamline operations, reduce errors, and accelerate order fulfillment. As a result, modern warehouses can handle higher volumes with greater precision, meeting the demands of today's customers.

Use warehouse management systems

A warehouse management system (WMS) is software that helps control and manage daily warehouse operations. It provides a central system for tracking inventory, managing storage, and coordinating the movement of goods.

When integrated with a modular and extensible commerce platform like Shopify, warehousing becomes even more seamless. Shopify's core functionality connects your warehouse operations with your ecommerce and retail systems out-of-the-box. 

For more specialized needs, our network of third-party apps plugs in effortlessly, ensuring inventory updates, order tracking, and customer data flow smoothly between your online store, warehouse, and retail locations. This guarantees efficient operations across every sales channel without painful implementation or customization.

A good WMS optimizes your warehouse with features like:

• Inventory tracking: Know exactly where each item is located, how many you have, and when to reorder.
• Space utilization: Get suggestions on the best places to store items based on their size, weight, and how often they're picked.
• Order fulfillment: The WMS guides pickers through the warehouse using the most efficient routes, speeding up the picking process and reducing errors.
• Performance metrics: Track key indicators like order accuracy, picking speed, and inventory turnover. This data helps you spot areas for improvement.
• Integration: Modern WMS solutions can connect with your other business systems, creating a seamless flow of information across your operation.

Create an efficient floor plan

The best warehouse layout starts with a clear floor plan. Think about how products move from start to finish, and make sure the aisles are wide enough for safe movement. Use tall shelves to make the most of your space, but keep safety in mind. 

Consider investing in warehouse design modeling and simulation software to create a digital twin of your facility to visualize workflows and test setups. They also help adjust layouts for new SKUs or seasonal demand without disrupting daily operations. 

Set up your layout so it's easy to change when needed. Place popular items where they're easy to reach and group similar products together. Good labels and new retail tech can speed things up, too. 

Install safety measures

Warehouse safety depends on a compliant environment where workers can thrive. Some key features to incorporate include:

• Emergency exits: Clearly marked and easily accessible.
• Fire safety equipment: Strategically placed extinguishers and sprinkler systems.
• First aid stations: Located in easily reachable areas.
• Security systems: Think CCTV cameras to prevent theft.
• Lighting: Install bright, consistent lighting throughout the warehouse, especially in high-traffic areas and near machinery.
• Floor markings: Use clear, visible lines to separate pedestrian walkways from vehicle lanes, mark out storage areas, and highlight potential hazards. 
• Ventilation: Good airflow helps prevent the buildup of fumes and maintains a comfortable working environment. Install fans or HVAC systems as needed.

Consider sustainability 

Businesses are increasingly focused on initiatives to reduce their carbon footprint. These include implementing energy-efficient lighting, adopting automated systems to minimize packaging waste, and utilizing environmentally friendly transportation options like electric vehicles. 

For example, industry leaders like Amazon have phased out single-use plastics in favor of recyclable packaging materials. These design considerations help reduce operational costs and align with global sustainability goals.

Prefer to focus on growth instead of logistics?

Operating a warehouse is no small feat. Design is just one aspect to consider—maintaining inventory levels, training warehouse staff, and disposing of waste are just a few of the things you’ll need to take into account. 

The good news is that you don’t need to own a private warehouse to distribute from one. Shopify Fulfillment Network will connect your store with Flexport, a leading logistics company, to manage the entire process for you. Simply ship your inventory to a Flexport distribution center and have incoming orders routed to the warehouse to be fulfilled and shipped—no intervention required on your behalf.