This is an excerpt from the Openfire Installation Guide found in your documentation folder of the Openfire server install folder:

Advanced users may wish to pass in parameters to the Java virtual machine (VM) to customize the runtime environment of Openfire. You can do this by creating vmoptions files in the bin/ directory of your Openfire installation. For the Windows service, you'd create a new text file called openfire-service.vmoptions. Each parameter to the VM should be on a new line of the file. For example, to set the minimum heap size to 512 MB and max VM heap size to 1024 MB, you'd use:

-Xms512m
-Xmx1024m

To create parameters for the normal launcher, create a file called openfired.vmoptions (since the openfire.exe launcher invokes the openfired.exe executable to actually start the server).