There's never enough closet space. At the start of our marriage hubs and I share one closet. Now we have two and there's still not enough space for our clothes and shoes.
A major organizing revamp is needed!
The closet should have varous partitions so you can group the clothes according to kind. And when folding shirts, it is best to fold it trifold. It looks more organized that way.
Just like in the kitchen, a pull-out pantry can also be used in a closet. Just make sure that it is installed in an angle. There is a terrific way to store shoes. And we have a lot of these! Hubs collects rubber shoes while I heart sandals/slip-ons/flip-flops!
Before storing handbags take out all its contents. I have a habit of putting back the bag I used without taking out the contents and this consumes time when I'm trying to find something and don't know which bag to check. So before you put it back in the closet, dump it's contents on a table. Then put acid-free tissue paper inside the bag so as to preserve its shape.
(pictures grabbed from marthastewart.com)