Storage is the fulfilment charge brands are most often surprised by, and the reason is structural: it is billed in units that have nothing to do with how you think about your inventory.
You think in SKUs and units. A warehouse bills in pallets, shelves or cubic metres. Those two views can produce very different numbers for the same stock, and the gap is where the surprise lives.
The three ways storage gets charged
Per pallet, per month or per week. The most common unit in Australia, and published ranges sit at roughly $20 to $45 per pallet per month. A standard Australian pallet is 1165 by 1165 millimetres; how much you fit on one depends on how high the warehouse will let you stack.
This unit suits stock that arrives and moves in pallet quantities. It suits a wide, shallow range badly — you can pay for a full pallet while using a third of it.
Per shelf, bin or location. Better for smaller items and larger SKU counts, because you are charged for the space each SKU actually occupies rather than rounding up to a pallet. Not every provider offers it, and the ones that do usually charge more per cubic metre than they would per pallet — which is fair, because shelving is more work to set up and pick from.
Per cubic metre. The most direct measure and the easiest to compare between providers, because it removes the packing question. As a rough conversion, a standard pallet stacked to a typical height is about two cubic metres.
If you take one thing from this article: ask which unit is being used before you compare two quotes. A provider quoting $25 and a provider quoting $45 may be charging the same amount for the same stock in different units.
Why the same stock costs different amounts
Three things drive your storage bill, and only one of them is the rate.
How well your stock packs. Two brands holding identical unit counts can occupy very different volume. Flat-packed items stack; irregular ones do not. Anything you cannot stack on top of wastes the vertical space above it, and you pay for that space whether or not you use it.
How long stock sits. Storage is a rent, not a purchase. A SKU that sells through in three weeks costs a fraction of an identical SKU that sits for six months. This is why a slow-moving line can be quietly unprofitable while looking fine on gross margin — the storage cost accrues month after month and is rarely attributed back to it.
How your range is shaped. A hundred units across two SKUs fits in one location. A hundred units across fifty SKUs needs fifty findable locations. Same units, very different footprint — which is the same arithmetic that makes providers decline high-SKU brands.
Estimating what you need
You do not need a warehouse to work this out. You need a tape measure and your sales data.
Measure the carton your stock arrives in and calculate its volume in cubic metres — length times width times height, in metres. Multiply by the number of cartons you hold at your typical peak, not your average, because you pay for the peak. That is your working volume.
Add a margin. Stock is not packed as tightly on a shelf as it is in a shipping carton, and you need room to reach it. Adding thirty to fifty per cent to the carton figure gets you closer to a real number.
Divide by two if you want a rough pallet count, using the two cubic metres per pallet conversion above.
Then check it against your sell-through. If you are holding four months of cover on a line that sells steadily, you are paying four months of rent on stock that could have arrived in two shipments.
The charges that sit next to storage
Storage rarely appears alone on an invoice.
Receiving, commonly $14 to $50 per inbound pallet, charged when stock arrives. Frequent small deliveries cost more in receiving than fewer large ones — which pushes against the instinct to hold less stock. There is a genuine trade-off here rather than a right answer.
Minimum monthly charges, commonly $300 to $500, which apply regardless of how little space you use. At low volume this dominates everything else on the invoice, and it is worth understanding before you sign.
Long-term or slow-moving surcharges. Some providers charge more for stock that has not moved in a set period, because a location holding dead stock cannot be used for anything else. Ask whether this applies and at what age.
Peak season rates. Warehouse space tightens before Christmas and some agreements price that differently. Ask what happens to your rate in November.
Questions worth asking
Which unit is storage charged in, and how is it measured — is it recalculated as your volume changes, or set at onboarding?
Is it billed weekly or monthly? Weekly billing on a monthly-sounding rate is a meaningful difference.
What happens when stock does not move? Is there an ageing surcharge, and when does it start?
How much notice is there before a rate change, and does peak season have its own rate?
And the one people forget: what happens to unsellable returns? Those occupy locations too, and someone is paying for them.
Where we sit
We are a fulfilment provider, so treat this accordingly.
Storage is measured against the space your stock actually occupies rather than rounded to a unit that suits the warehouse, and the measurement is recalculated as your volume changes rather than fixed at onboarding. Ecommerce storage sets out how it is charged and what is included.
If you would rather see the numbers than read about them, the calculator uses published Australian market ranges for storage and receiving, so you can put your own volume against them before anyone quotes you.