Storage Fees

Storage fees are charged according to the number of days stock cover for each product. Fees are applicable for products that have a stock cover greater than 35 days. Items with a stock cover of 35 days or less do not incur storage fees.

Basic example: The fulfilment center (FC) has two (2) existing products from ‘Company XYZ’ (Kettles: 20 units / Air Fryers: 20 units).

The calculation summary shows how the storage fees are charged using the average stock and average sales for the respective period.

When a product is sent to our fulfillment center for the first time or has not been in stock for a period of 3 months or longer, no fee will be calculated for the respective prorate period. The storage fee calculation is initiated on the 1st day of the new month.

Storage Fees Rate Card

Zero Sales scenario

A 90-day extension rule is followed when there are zero sales for the month. This means the average stock and average sales range is extended 90 days prior (up to the point of the last sale) in order to determine the average days stock cover. The above calculation still applies but the period will be extended up to the last sale within the past 90 days and not the past month. The average stock used to calculate the storage fee will still be based on the last month.

If there are zero sales in the 90-day period or sale-to-stock ratio is less than 1%, the days count method is used. The sale-to-stock ratio is the average sales divided by the average stock over the 90-day period (multiplied by 100).

Days count method

The days count method counts the number of days stock was in the FC over the 90 day period and utilizes this as the ‘average days stock cover’. This method is used when there are zero sales in the 90-day period or the sale-to-stock ratio is less than 1%.

As an example: let’s assume the kettles did not have any sales for the month of May and the following data applied:

Even though the average days stock cover of 177,77 (90 days) is greater than 35 days, the sale-to-stock ratio is less than 1% therefore the days count method will need to be applied. We would now need to consider how many days stock was in the FC over the 90-day period; which in this case is 90.

In this scenario, the Seller will be charged a storage fee as the days count of 90 is greater than 35 days. The Seller will be charged a storage fee of R100.00 excl. Vat for May.