Cubic velocity calculation is used for storage equipment selection. The formula consisting of the average quantity ordered, the product’s dimensions, the desired pick location, the number of days on hand, and the pick unit of measure (full case or piece).
Multiply the average quantity ordered by the product’s cubic dimension to calculate the cubic velocity per day.
Then, to define the equipment location size required, multiply the days-on-hand inventory target by the cubic velocity per day.
Based on the resulting cubic velocity needed to support the days on hand in the picking area, you can identify the equipment required. Equipment types include modular drawers, bin shelving, standard shelving, carton flow racks, decked racks, pallet racks, and pallet flow racks, floor stack, etc. Once you match the cubic velocity with the equipment type, you can organize the equipment within the layout in zones for efficient picking.