The Complete Cost Breakdown of a Pallet Racking Fitout

Why Pallet Racking Matters for Warehouse Efficiency

Pallet racking is a critical component in the infrastructure of any warehouse. It plays an essential role in organising products, ensuring smooth workflow, and enhancing the safety of both goods and staff. Without a well-planned and effectively implemented pallet racking system, it’s nearly impossible to maximise the return on investment for any facility, whether it’s rented or owned. At Shelving Depot we know investing in an optimal storage solution isn’t just about creating space—it’s about streamlining operations to improve both productivity and safety.

Warehouse storage systems, such as pallet racking, are essential for organising inventory and optimising space utilisation. These systems directly impact how efficiently a facility operates. We’ve found that poorly planned racking can result in wasted space, increased labour, and even compromised safety. With that in mind, we’ve put together this complete cost breakdown to help you and your team understand the various costs and factors involved in a pallet racking fitout. Use it as a starting point to make a plan to suit your long-term storage needs, then get in touch – we’re ready to help.

Key Components of a Pallet Racking Fitout

A pallet racking fitout consists of several core elements, all of which contribute to the overall cost. While the specific components may vary depending on the complexity and scale of the project, the following are typically involved:

Pallet Racking Systems:

The pallet racking system is the foundation of the fitout. Two of the most common types used in warehouses are selective and double-deep racking systems. Selective racking is known for its simplicity and versatility, making it suitable for a wide range of goods. Double-deep racking, on the other hand, allows for denser storage by positioning two pallets deep. Both systems are favoured for their cost-effectiveness, providing a lower cost-per-pallet-space compared to more complex systems. Also see Worksafe’s comprehensive article which explains what good practice looks like when selecting, using and maintaining an adjustable or selective pallet racking system.

Asset Protection:

Protecting both the racking and the goods stored on it is crucial for long-term use. This can include barriers, guards, and rack protection systems that prevent accidental damage from forklifts and other equipment. These protective measures not only enhance safety but also reduce the likelihood of costly repairs.

Council Consenting Costs: 

Before the installation begins, it’s often necessary to obtain council consent. This process can be time-consuming and adds to the overall cost, but it’s a legal requirement that ensures compliance with building codes and safety standards. In some cases, council consent may also trigger the need for upgrades to fire systems or sprinklers, particularly in older buildings. In recent years, councils around New Zealand have been enforcing higher standards of compliance for pallet racking fitouts. At Shelving Depot we have responded by building our own in-house team in order to offer a complete service and take the stress out process for you.

Lighting Costs (Emergency and Ambient):

Adequate lighting is essential for both safety and operational efficiency in any warehouse. Emergency lighting ensures that staff can safely exit the building in the event of a power outage or emergency, while ambient lighting provides the necessary visibility for daily operations. These lighting systems can add a significant cost to the overall fit out but are essential for compliance and safety. So budget them in from the outset. While we don’t provide lighting at Shelving Depot we liaise with experts on emergency lighting requirements.

Egress Signage Costs:

Clear and well-placed egress signage is another mandatory safety measure. This ensures that employees can quickly locate exits in case of an emergency. While the cost of signage may seem minor compared to other components, it is a necessary part of the overall fitout to ensure legal compliance and workplace safety.

Cost Factors: Material, Labour, and Additional Elements

Several variables contribute to the overall cost of a pallet racking fitout. The size of the project, timeline, and specific racking specifications all play a role in determining the final price.

Size of Project:

Larger projects often result in a lower cost per pallet space. This is because the economies of scale allow suppliers to offer more competitive pricing on aspects such as project management, manufacturing, and shipping. These efficiencies are typically passed on to the end user, resulting in overall cost savings.

Timing of Project:

The timeline of the project also has a direct impact on costs. If a project needs to be completed within a short timeframe, it will usually be more expensive. However, if planning begins well in advance—often 4-5 months ahead—there is an opportunity for suppliers to deliver racking directly from their factories, which reduces handling costs and allows for savings to be passed on to the client.

Specification:

Another important cost factor is the specification of the racking system. The type and quality of the steel, the dimensions of the components, and the weight capacity all influence the final price. Over-engineering the racking system, while it may provide extra durability, can reduce the return on investment by unnecessarily inflating the cost. It pays to work with your provider on this and find a happy medium. At Shelving Depot our team knows shelving – and we’re happy to work with you to find the right fit.

Average per square metre cost:

The average cost per square metre for pallet racking is approximately $100, which serves as a reliable estimate for most facilities. This rate typically applies to standard racking systems, such as selective and double-deep configurations, providing a cost-effective solution for efficient storage management. However, costs may vary depending on specific requirements, including customisations or additional features.

Long-Term Costs: Maintenance, Repairs, and Upgrades

One of the advantages of conventional pallet racking systems, such as selective or double-deep racking, is their low maintenance requirements. These systems have no moving parts, which makes them relatively inexpensive to maintain. However, regular audits remain necessary to ensure that the racking remains safe and compliant.

Annual inspections, typically costing between $1300 and $1800 (depending on the location and size of the facility), should be conducted by a qualified professional. During these inspections, any necessary repairs or upgrades will be identified. Typically, repairs cost around $1500 per 1000 square metres per year. Additionally, ensuring that your supplier offers aftercare services and carries spare parts is important for long-term maintenance. Some suppliers may offer low initial prices but lack the support needed for small fix-ups after the main fitout is completed, so query this from the outset.

Tips for Budgeting: Avoiding Hidden Costs

Proper planning is the key to avoiding unexpected costs during a pallet racking fitout. Some of the most common budgeting pitfalls include:

  • Not incorporating consenting costs: Changes to building codes mean that older warehouses may not be compliant for storage over 3 metres, even if they have had racking in the past. Council consent applications may also require costly upgrades to sprinkler systems or fire alarms.
  • Overlooking forklift equipment: While many businesses don’t consider this, buying forklifts without considering racking can lead to inefficiencies. We’ve seen it happen! If the wrong equipment is chosen, it may require more space than necessary, reducing storage capacity and increasing costs. Wait until planning is done to buy your machinery.
  • Design changes after consent: Making changes to the design after council consent has been obtained can result in significant additional costs. These include reapplying for consent and additional engineering reviews. This is where careful planning with an experienced provider from the outset is key.
  • Failing to plan for future growth: A fitout designed only for current needs may become outdated quickly. A more flexible and scalable design can accommodate changes such as shifts in packaging size or product lines, reducing the need for costly upgrades in the future. Our advice is to always plan for changes.
  • Consider exploring second-hand options: purchasing used pallet racking can save you around 30% compared to buying new equipment. Not only is it a cost-effective solution, but it can also help you maintain high functionality while staying within budget.

Ensuring Value for Money: Future-Proofing and Supplier Relationships

When planning a pallet racking fitout, it’s important to focus on value rather than just the upfront cost. Investing in good-quality handling equipment early on, such as narrow-aisle forklifts, can provide long-term savings by maximising storage capacity. Moreover, building a strong relationship with your supplier can lead to better service and more favourable pricing for future projects.

Planning well in advance and choosing suppliers who understand your business objectives will ensure you get a solution that fits your current needs while allowing for future growth. Involving experts from the beginning will save you time, money, and headaches in the long run. It’s also wise to limit the number of quotes you obtain to around three. Beyond that, suppliers may not offer their best pricing or service due to the competitive nature of the process.

Maximising the Return on Your Pallet Racking Fitout

A pallet racking fitout is a significant investment, but with proper planning, supplier relationships, and an eye for long-term value, it can enhance the overall efficiency and safety of your warehouse. Engage experts early, consider your long-term business goals, and remember that well-organised racking is a tool that will pay dividends in operational efficiency for years to come. Planning ahead and making informed decisions will not only save money but also ensure that the racking system supports your business as it grows.

Want to ensure compliance with the latest standards while optimising your warehouse operations? Let our experienced in-house team guide you through every step of the process. From design and council consent to installation and long-term maintenance, we’re here to deliver a tailored solution that meets your needs. Contact us today to discuss your project and see how we can help you maximise efficiency while staying compliant.