Warehousing & Storage Costs

[thisislife]

I started a small business last April 2008 and got a small warehouse on a working farm. The unit i started in was about 600sq ft @ £250 per month. I only lasted a few months in there before moving to a bigger unit on the same farm 1200sq ft for £600 which included 2 small offices, toilet and kitchen. In November 2008 we had to move again to another farm near by. The unit is 5400sq for £1450 per month. We are still in this unit at the moment but will be looking to move again in the summer to something around 10,000sq ft.

Obviously the bigger we go the more rent is and rates. I just wondered what people are paying for larger sized warehouses. Obviously cost is a big issue. We are in internet retail and store goods at our premises for daily distribution. I have considered getting a 10,000sq ft and then putting in a mezzanine floor to double up but a few people have pulled faces when mentioning it saying it would be cheaper just to get a larger warehouse still and keep the stock on the ground floor.

Any comments and experiences would be greatly received.

Regards

[Exigeowner]

I pay £ 1000 per month for about 3500 SQ ft at a shared unit, this includes rates, heating bills and use of forklift, sharing has some drawn backs but overall I think im better off.

for maximizing space we use very high pallet racking and a forklift or reach truck, bought it all 2nd hand, many companies with work out a floor plan for you to get most number of pallet spaces although most of our stuff is heavy, if you business is lots of picking for low value orders then messing about with forklifts for day to day stuff is probably not best,

[thisislife]

Yeh we are picking and packing a high volume of smallish items on a daily basis so the highest items can only be stored at about 6ft for reaching purposes.

Becasue of this height restraint the only option i can see for us is to just rent more and more floor space. A mezz flooring would be too expensive to buy and put up/take down if we ever moved.

All of the units i have rented so far have been farm units/barns. I have no idea how much a modern 10,000sq ft unit would be but im guessing a lot more than a barn? The 10,000sq ft one we are looking at for a move in the summer is £2.50per sq ft which i think is a pretty good deal.

[BruceV8]

Sorry this isn't helping answer your question, but is £250 for 600 sq ft on a farm about the going rate or did you get a good deal? I only ask as I will need to store a few cars soon and I was thinking of approaching the local farmers first.

[thisislife]

Hi BruceV8,
I thought this was pretty cheap. The rates were £50 per month but as it was small i applied for small rates relief which gives you 50% off. By the way the price i quoted £250 includes the rates mentioned.

If you want a cheap unit the farm route is deffinatly the best way to go. A lot of them are funny about having mechanics/car garages in the units as generally its a messy business and lots of cars end up being stored getting in the farmers and everyone elses way. Im pretty sure there wont be a problem with simple storage of vehicles though.

[A1]

We sell furniture but currently use a pick and pack company to do all our warehousing and distribution. Working out ok but future expansion is to either buy or rent a place.

[PhilLL]

Have you had any quotes for mezzanine floors? Where you have the clear head height it can be more cost effective than relocating to a larger unit. Another option could be a 'rack supported floor' or 'two-tier floor' where the ground level shelving supports the floor and/or shelving above.

If you want any more advice feel free to ask

[apguy]

Don't forget that mezzanine flooring is rateable, where-as increased height pallet racking isn't.

For reference I pay £45,000 a year for 9000 sqft of space and 1500 sqft of offices. Thats a modern'ish unit on an industrial park with 8 metre eaves and exterior parking for 25 cars.