What I need to know if Operating Own Warehouse

Fixed Costs (Recurring Expenses)

1.1 Warehouse Rental / Purchase Cost

• Rent: Depends on location, size, and facilities (e.g., RM1.80 – RM3.50 per sq. ft. in Malaysia).

1.2 Utilities & Facility Maintenance

• Electricity, water, and internet (~RM500 – RM10,000/month depending on warehouse size and equipment).
• Repairs, pest control, and cleaning services.

1.3 Equipment & Machinery

• Racking & shelving systems (~RM50,000 – RM200,000+ depending on warehouse size).
• Material handling equipment (e.g., forklifts: RM30,000 – RM100,000 each).
• Packing stations, barcode scanners.
• Computer, CCTV, Sorting Rack & Etc.

1.4 Warehouse Management System (WMS) & Software

• Cloud-based WMS subscription (RM500 – RM5,000/month).
• Integration with ERP, OMS, and e-commerce platforms.

1.5 Compliance & Insurance

• Licensing & permits (e.g., business license)
• Warehouse insurance (fire, theft, liability) ~RM1,000 – RM30,000/year.

2. Variable Costs (Scaling Expenses)

2.1 Labor Costs

• Warehouse staff salaries (e.g., RM2,000 – RM4,500 per worker).
• Supervisors, managers, and warehouse operators.
• Overtime, benefits, and training expenses.

2.2 Inventory Holding Costs

• Storage space usage (higher inventory levels increase rent).
• Inventory shrinkage, obsolescence, and damage.

2.3 Order Fulfillment & Packaging

• Packaging materials (cartons, bubble wrap, tape, labels).

2.4 Logistics & Transportation

• Fleet management (if owned) – truck leasing, fuel, maintenance.
• Third-party delivery costs (coordination and monitoring)

3. Hidden / Unexpected Costs

• System downtime or IT failures.
• Warehouse expansion or relocation costs.
• Loss from inaccurate inventory management (overstocking, stockouts).

Estimated Cost Summary (For a Mid-Sized Warehouse in Malaysia)

💡 Total Monthly Operating Cost Estimate: RM20,000 – RM300,000+
💡 Initial Setup Cost (One-Time): RM150,000 – RM1,000,000+