A warehouse quoted at a lower rent per square foot does not automatically offer the lowest storage cost. For a pallet-based operation in Sriperumbudur or Oragadam, the useful comparison is what you pay for a workable layout and how much of that capacity your business will use.
This guide separates three measures: rent per square foot, rent per available pallet position, and rent per average occupied position. The figures below are invented teaching examples, not current market rents or quotations from any industrial park.
1. Establish a comparable pallet position
A pallet position means one usable storage slot for a specified pallet size, loaded height and weight. Two layouts are not comparable if one assumes smaller pallets, lighter goods or storage levels your equipment cannot reach. Ask each designer to use the same inventory profile and handling equipment assumptions.
Start with the rack layout, then deduct positions that are unavailable because of columns, access restrictions or equipment conflicts. Keep receiving, dispatch, returns and inspection space separate from normal storage capacity. A temporary staging location should not also appear as a permanent rack position.
The UK Health and Safety Executive’s warehousing and storage guidance highlights the need for compatible pallets and racking, suitable load capacity and layouts that allow safe handling. It is a useful technical reference; the final local layout needs review by the relevant competent professionals.
2. Compare the same cost using two denominators
| Illustrative measure | Warehouse A | Warehouse B |
|---|---|---|
| Billable area | 50,000 sq ft | 50,000 sq ft |
| Monthly base rent per sq ft | ₹24 | ₹27 |
| Monthly base rent | ₹12,00,000 | ₹13,50,000 |
| Usable pallet positions in reviewed layout | 2,000 | 2,500 |
| Base rent per available position per month | ₹600 | ₹540 |
The arithmetic is straightforward: monthly base rent divided by usable pallet positions. Warehouse B has a 10% lower rent cost per available position, even though its monthly base rent is ₹1.5 lakh higher. That difference describes storage capacity economics, not an automatic saving for the tenant.
3. Recalculate using the inventory you expect to hold
Suppose the business expects to hold an average of 1,800 pallets at either site. Warehouse A then costs about ₹667 per average occupied position per month in base rent; Warehouse B costs ₹750. The extra capacity at B has value only if it supports a real requirement, such as peak stock or planned growth.
Use average daily occupied positions over the month for this measure. A month-end stock count can misrepresent the workload if inventory rises sharply before dispatch. Also check peak demand separately: an average of 1,800 pallets does not show whether a seasonal peak would exceed A’s 2,000 positions.
Two useful formulas:
Capacity cost = monthly comparable cost ÷ usable pallet positions.
Occupied-position cost = monthly comparable cost ÷ average daily occupied pallet positions.
4. Add the costs that change the decision
- Add recurring property costs such as maintenance, contracted common services and utilities using the same scope for both sites.
- Show racking, handling equipment and systems separately. If spreading an upfront cost across a planning period, label the period and keep the original cash payment visible.
- Include any additional handling or transport expense caused by the chosen layout and location.
- Keep refundable deposits separate from recurring expense. Record the cash tied up instead of treating the full deposit as monthly rent.
- Use the same treatment of taxes and recoverable amounts across quotations, confirmed by your finance team.
A fully serviced third-party logistics quote may include labour and handling that a bare-building lease excludes. Do not compare the two headline numbers until their included services and volume assumptions match.
5. Test capacity against throughput
Storage positions measure how much stock can fit. They do not measure how many orders the site can receive, pick or dispatch during a shift. Test the busiest operating window with your operations team, including replenishment movements and the space needed to stage outgoing loads.
For goods that are not palletised, use a more suitable unit such as a standard bin, carton location or defined storage zone. Retain separate measures for different types of stock instead of forcing everything into an inaccurate pallet conversion.
What to request during a property visit
Bring pallet dimensions, peak and average stock, daily movements and your handling-equipment plan. Ask for a scaled layout and an itemised quotation before deciding which building has the better economics. If Mansi Industrial Park is on your shortlist, use the same brief there and ask the team to confirm the proposed layout and current commercial terms.
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