Propose a method to measure space utilization

The most cost-effective, scalable approach will be one that relies more on advanced software than advanced hardware. There are essentially two problems to be considered: data collection and data processing. To measure utilization, we essentially need to find out how much shelf space is being used, and how much is empty (note that I am not including walkways or offices as those spaces are not usable for storage). I believe that this problem can be solved using existing, relatively inexpensive 3D modeling software. The utilization can then be calculated directly as ( used shelf space ) / ( used shelf space + free shelf space ). The xbox Kinect costs $150, and it is more than enough to do exactly what you need. If you outfit all of your forklifts with kinect cameras, they will be able to profile the shelf space and determine where space is being used and where it is free. The data from the kinect can be filtered so that only the data taken for usable space (not walkways) is used. After all of the warehouses are outfitted with kinects, the heavy lifting can be accomplished by software, which will be a one time investment. Even the software will not be too hard to write: inside the isles, you can make a contour map of your immediate surroundings. If isles are 7 feet wide, contours more than 5 feet away from the kinect likely indicate shelf space not being used, whereas contours that are less than 5 feet are indeed being used. If you really want to get fancy, you can have the kinect build a 3D rendering of each building, and you could assign warehouse managers to designate which spaces should be considered as usable for storage. Calculating utilization this way will also give you more information as to how fragmented your free space is: there is a difference between having a hundred cubic yards of free space in once large chunk versus having the same amount scattered throughout a warehouse. By using algorithms to minimize fragmentation (much like your computer does with its "heap allocator"), you will be able to use this data to actually improve your utilization.