Enter the number of units stored, cost per unit per day, number of days the units are stored, maintenance cost per unit per month, and total number of months the units are stored into the calculator to determine the total storage cost.

Storage Cost Formula

The following formula is used to calculate the monthly storage cost. 

SC = (U * P * D) + (M * T)

Variables:

  • SC is the total storage cost ($)
  • U is the number of units stored
  • P is the cost per unit per day ($)
  • D is the number of days the units are stored
  • M is the maintenance cost per unit per month ($)
  • T is the total number of months the units are stored

To calculate the monthly storage cost, multiply the number of units stored by the cost per unit per day, then multiply the result by the number of days the units are stored. Add this to the product of the maintenance cost per unit per month and the total number of months the units are stored.

What is a Storage Cost?

Storage cost refers to the expenses associated with storing inventory or data that a company or individual does not currently need but cannot dispose of. These costs can include rent for warehouse space, utilities, security, insurance, depreciation, and personnel costs for managing the inventory. For digital storage, costs can include server maintenance, electricity, and data management. These costs are a significant part of a company’s operational expenses and can impact the overall profitability.

How to Calculate Storage Cost?

The following steps outline how to calculate the Storage Cost.

  1. First, determine the number of units stored (U).
  2. Next, determine the cost per unit per day (P).
  3. Next, determine the number of days the units are stored (D).
  4. Next, determine the maintenance cost per unit per month (M).
  5. Finally, determine the total number of months the units are stored (T).
  6. After gathering all the variables, use the formula SC = (U * P * D) + (M * T) to calculate the total storage cost.

Example Problem:

Use the following variables as an example problem to test your knowledge.

number of units stored (U) = 50

cost per unit per day (P) = 2

number of days the units are stored (D) = 30

maintenance cost per unit per month (M) = 10

total number of months the units are stored (T) = 6