Storage billing
How to bill storage: per pallet, per bin, per cubic foot
How to bill storage starts with picking the unit that matches how the space is actually used: per pallet for floor and rack storage, per bin for small parts, per cubic foot when customers occupy mixed volumes. Pick the unit the floor can count without a debate, publish the rate and the free period with it, and charge from the same count the warehouse works from. A range often quoted for pallet storage is $8-25 per pallet per month; check it against your own market rather than copying it.
By Richa Myria, Microsive
The three units, and what each suits
| Unit | Suits | How it is charged | Watch out for |
|---|---|---|---|
| Per pallet | Floor, rack and staging storage | A rate per pallet per week or month, counted at the pallet level | Mixed pallets and pallets that move mid-month |
| Per bin | Small parts, high-count inventory | A rate per bin location per period | Bins shared by several SKUs, re-slotting between periods |
| Per cubic foot | Mixed volumes, overflow, goods that do not stack | A rate per cubic foot, measured from stored dimensions | Dimensional data quality: a wrong height makes every invoice wrong |
The rate is more than the number
A storage rate only means something next to three other settings: the free period before charging starts, the counting cadence (daily, weekly, month-end snapshot), and the proration rule for partial periods. Write all four together in the contract, because disagreements almost never start at the rate; they start at the count date.
A worked month
| Step | Math | Result |
|---|---|---|
| Pallets in storage on day 1 (opening count) | 300 | 300 billed |
| Monthly charge | 300 x $14 | $4,200 |
| Ten pallets shipped out on day 10, credit for 20 unused days | 10 x $14 x (20/30) | $93.33 |
| Invoice for the month | $4,200 - $93.33 | $4,106.67 |
Rules that keep the invoice boring
- Charge from the count the warehouse works from, not a second count taken for billing.
- Publish the free period, the count date and the proration rule with the rate.
- Price minimums explicitly (a minimum monthly storage charge is a line, not a silent floor).
- Re-slotting and consolidation are value-added services with their own rates, not free storage movement.
- Give customers a statement they can reconcile: opening count, movements, closing count, rate, total.
If the customer can see the count you charged from, most disputes end there.
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