Welcome to Narrow Aisle - Home of the Flexi Lift Truck

Example

Customer Profile:

Growth Mode: (13% last 3 years expects 13% next 2. years)
Out of Space: (wants to lease additional location)
Existing Facility: 20,000 sq. ft.
Storage Method: Selective Rack 4 high (could go 5 high)
Equipment: 2 ea. 3000 lb. Reach Trucks (800 hrs/yr ea.)
1 ea. 3000 lb. CB truck (1100 hrs/yr)
Inventory Turns: averages 6 turns per year

Approx. number of pallets in existing warehouse? (20,000 sq. ft / 8.5 sq. ft. per pallet = 2353 pallets)
Approx. # pallets customer will need to store to handle the 2 year growth? (2353 /.87/.87 = 3108 pallets)
How many pallets will the customer have to find outside storage for? (3108 less 2353 existing = 755 pallets)
Sq. ft. of additional warehouse space required to store 755 pallets the way the customer is doing it now? ( 755 pallets x 8.5sq. ft = 6417 sq. ft. )
Cost for customer to lease additional warehouse space to store 755 pallets? ( 6417 sq. ft. x $.50 psf / month = $3208.50 per month or $38,502 per yr.)
What will customer pay for operating costs for extra space? (6417Sq. Ft. x $2/PSF ave. = $12,834 yr = 1069 /month, for utilities, taxes, maintenance, insurance)
Cost of equipment for additional warehouse space? (1 ea. used Reach 10,000 + 1 ea~ used CB $10,000 = $20,000) Lease cost for $20,000 x.0199 = $398 / month =$4776/Yr
Labor costs for additional warehouse space. (1 person min. 20hrs. week capable of operating reach and CB forklift x $15hr. salary w/ fringe = $1300 per month or $15,600 per yr.)
Handling costs to transport product to additional location. (755 pallets x $4 ea. handling x 6 turns per yr. = $18,120 yr or $1510 / month.)
Additional paperwork to track outside location ($100 / month or $1200 / yr.)
Inventory accuracy problems - locating product ($100 I month or $1200 / yr.)
Could a Flexi (5 high system) handle the customer's growth and keep the customer in the same building? (Yes! 20,000 sq. ft. / 6.18 sq. ft. for 5 high = 3236 pallets)
How many Flexi's would be required to perform the same operation and keep customer in same location? Note: the Flexi can perform the work of both Reach and CB trucks (Total all existing forklift hrs = 2700 hrs / .87 /.87 3567 hrs per year is expected total hrs with growth) (3435 hrs. yr / 2 ea. Flexi = 1783 hrs per year ea. truck) or (2 trucks one single shift) Only 2 Flexis required!
Can customer reduce the number of employee's w/ Flexi? (Yes! 2ea. Flexi's can perform the work of 2 reach and 1 CB. Saving the customer the cost of 1 operator at $15 hr = $2600 / month, $31,200 yr.)
Estimated trade-in allowance on existing equipment? (2 ea. Reach Trucks @ $6000 ea. + 1 ea. CB @ $6000 = $18,000 trade -in allowance)
Purchase price for purchasing 2 ea. Flexi's with quad masts and side-shift including battery and charger less trade-ins? ($45,000 x 2ea. = $90,000 less trades <$18,000> = $72,000 purchase price after trade-ins.)
Estimated 5 yr. lease amount on $72,000 ? ($72,000 x.0199 = $1432.00 month + tax)
Proposed savings for customer utilizing Flexi's and staying in existing facility;

	Month	Year	5 years
Prevention Cost Savings:
-Outside storage lease cost	3,208	38,502	192,510
-Overhead for outside storage	1,069	12,828	64,140
-Equip.(lease) outside storage	398	4,776	23,880
-Labor for outside storage	1,300	15,600	78,000
-Additional transfer /handling	1,510	18,120	90,600
-Additional inventor problems	100	1,200	6,000
-Additional paper work	100	1,200	6,000
Reduction for Existing Operation:
-Reduction of 1 forklift operator	2,600	31,200	156,000
	====	=====	=====
Total Operational Savings	$10,285	$123,426	$617,130
Less Equipment lease	<1,432>	<17,184>	<85,920>
	====	=====	=====
Total Proposed Savings	$ 8,853	$106,242	$531,210

Customer Payback on $72,000 = 8.13 months
($72,000 / $8853 monthly savings = 8.13 months)