# Warehouse Labor Cost per Order Calculator > Source: https://netray.co/tools/warehouse-labor-cost-per-order-calculator > Publisher: Netray (netray.co), AI and integration engineering for ERP and manufacturing systems. > Section: Free Tools ## Short answer Turn pick, pack and ship times into labor cost per order, daily hours and the headcount you need. ## Category cost-finance ## Industry Warehousing and Distribution ## Audience - Warehouse manager - Fulfillment manager - Operations controller ## Tool **Kind:** calculator **Currency:** $ **Inputs:** #### Orders per day **Key:** orders_per_day **Type:** number **Default:** 1200 **Min:** 0 **Step:** 50 **Unit:** orders #### Lines per order **Key:** lines_per_order **Type:** slider **Default:** 3 **Min:** 1 **Max:** 20 **Step:** 0.5 **Unit:** lines #### Pick time per line **Key:** pick_min **Type:** number **Default:** 0.6 **Min:** 0.05 **Step:** 0.05 **Unit:** min **Help:** Include travel, search, pick and scan. #### Pack time per order **Key:** pack_min **Type:** number **Default:** 1.8 **Min:** 0 **Step:** 0.1 **Unit:** min #### Label and staging time per order **Key:** ship_min **Type:** number **Default:** 0.7 **Min:** 0 **Step:** 0.1 **Unit:** min #### Hourly wage **Key:** wage **Type:** number **Default:** 19 **Min:** 0 **Step:** 0.5 **Unit:** per hour #### Benefits and payroll burden **Key:** burden **Type:** slider **Default:** 28 **Min:** 0 **Max:** 60 **Step:** 1 **Unit:** % #### Productive hours per person per day **Key:** productive_hours **Type:** number **Default:** 6.5 **Min:** 1 **Max:** 12 **Step:** 0.25 **Unit:** hours **Help:** Paid shift length less breaks, meetings and idle time. **Outputs:** #### Labor minutes per order **Key:** min_per_order **Expr:** lines_per_order * pick_min + pack_min + ship_min **Format:** decimal #### Loaded hourly rate **Key:** loaded_rate **Expr:** wage * (1 + burden / 100) **Format:** currency #### Labor cost per order **Key:** cost_per_order **Expr:** min_per_order / 60 * loaded_rate **Format:** currency **Primary:** true #### Labor hours per day **Key:** hours_per_day **Expr:** orders_per_day * min_per_order / 60 **Format:** hours #### People needed **Key:** headcount **Expr:** ceil(hours_per_day / productive_hours) **Format:** integer **Primary:** true #### Labor cost per day **Key:** daily_cost **Expr:** orders_per_day * cost_per_order **Format:** currency **Chart:** #### Labor cost per order vs lines per order **Type:** line **X:** lines_per_order **From:** 1 **To:** 12 **Steps:** 22 **Series:** - cost_per_order **Disclaimer:** Direct labor only. Add supervision, equipment, packaging and overhead for a full cost to fulfill. ## Content **Intro:** Pricing, staffing and outsourcing decisions all depend on knowing what an order costs in labor. This calculator builds the figure from pick, pack and ship times, then converts it to daily hours and headcount. **Sections:** #### How to use it **Body:** Time the three stages separately: pick per line, pack per order and label or staging per order. Use observed averages across several people, not your best performer. Enter wage and a burden percentage for taxes and benefits, then the productive hours you really get from each person, after breaks, training and waiting. The slider on lines per order shows how basket size drives the cost. **Bullets:** - Time at least 30 orders per stage - Use the average of all pickers - Use paid hours less breaks for productive hours - Run the model separately for single line and multi line orders #### The method behind it **Body:** Minutes per order equal lines multiplied by pick time, plus pack time and ship time. Loaded rate equals wage times one plus burden. Cost per order is minutes divided by 60 times the loaded rate. Labor hours per day are orders times minutes divided by 60, and headcount is hours divided by productive hours per person, rounded up. This approach is widely used for engineered labor standards. #### Reading the result **Body:** With three lines per order, the example takes 4.3 minutes per order and costs about 1.75 in labor, so 1200 orders need around 86 labor hours and 14 people. The chart shows each extra line adds a similar increment, which is why single line orders have higher cost per line than larger orders. Compare the figure with your shipping and packaging cost to see the full picture. #### Common mistakes **Body:** Using engineered best case times without allowances understates cost. Forgetting that pack and label time do not scale with lines gives the wrong sensitivity. Leaving out indirect roles, such as receiving, replenishment and returns, makes direct labor look cheaper than the real cost to serve. **Bullets:** - Using best case instead of average times - Ignoring productive hour allowances - Leaving out indirect labor - Averaging single line and multi line orders together **Cta:** Netray can calculate labor cost per order from your WMS task times and ERP payroll data, by customer and by channel, so you price fulfillment on real numbers. **Faq:** #### How do I calculate labor cost per order? **Answer:** Add up the labor minutes to pick, pack and ship the order, divide by 60 and multiply by the loaded hourly rate. The loaded rate is wage plus burden for payroll taxes and benefits. #### What productive hours should I use? **Answer:** Use paid hours minus breaks, meetings, training and idle time. Many operations see 6 to 7 productive hours from an 8 hour shift. Measure it from timekeeping or task systems when possible. #### Does this include shipping cost? **Answer:** No. It is labor only. Add packaging, carrier charges, equipment and overhead to get the total cost to fulfill. Keeping them separate helps you see where improvement is possible. #### How does order profile affect cost? **Answer:** Pack and ship times are per order, so small orders carry a higher cost per line. Larger baskets spread that fixed time. Model different order types separately for accurate pricing. ## Search terms labor cost per order calculator, fulfillment cost per order, warehouse labor cost per order, pick pack ship cost calculator, order processing cost formula, warehouse headcount calculator, cost to fulfill an order, fulfillment labor standards --- Talk to an engineer: https://netray.co/contact?intent=erp_ai | Machine catalog: https://netray.co/agent/catalog.json