Storage Pricing FAQs

How it works

 

Q: What is On-Demand storage?

A: On-Demand storage is our offering that gives members the space to store frequently purchased items with enough runway so that they will comfortably stay in stock.

 

Q: What is Surplus Storage?

A: Surplus storage is our second storage offering that recognizes that there are a myriad of reasons why a business owner may need to store more inventory than can be sold in a matter of months. Surplus storage is any inventory above the On-Demand storage allowance.

 

Q: My contract is listing the surplus start threshold in cubic footage. How does that cubic footage translate to number of bins and pallets?

 

A: We do not measure storage in bins and pallets, though, we do use pallets as a common reference point when describing storage amounts. 

 

We measure storage in cubic footage since that is how we will bill you. Each cubic footage tier roughly corresponds to a number of standard pallets (48x40x60). You can estimate the number of pallets by dividing the cubic footage by 66.67 cubic feet.

 

Regardless of where we choose to store your item or how full that location is, the cubic pricing is designed to allow you to only pay for the space that you are using.

 

Q: If I am storing enough inventory that I meet the Surplus start threshold, how will you pick which inventory is being billed at the On-Demand rate and which is billed at the Surplus rate?

 

A: Every day, all SKUs that you sell with us are ranked by their monthly sales where the fastest-selling item will have the highest rank and the slowest-selling item the lowest rank. The fastest-selling SKUs will be billed at the On-Demand rate. Once the number of pallets for that ranked list exceeds the Surplus start threshold for your order segment, the remaining SKUs will be billed at the Surplus rate. With this method, a very effective way to reduce your Surplus charges is to focus on reducing the space used by your slowest-moving items.

Order Segment Determination

Q: How is my order segment determined?

A: The order segment you are assigned is the higher order volume segment when comparing the current month and the previous month. For example, if you are on track to have 200 orders for the current month, but you had 275 orders the previous month, the 251 - 500 order segmentation would be used for your billing.

 

Q: What will happen with my storage billing if I switch between order segments from month to month?

A: The two-month order segment view is designed to give you a grace period for slight variations in order volume or a slow month after having a big marketing campaign.  If a dip becomes consistent for two consecutive months, it will be reflected in an adjusted order segment and storage pricing.

 

Q: What will happen if I only have Surplus storage for a couple of days here or there or am planning on having a large delivery that will quickly go out as an FBA order?

A: If you are someone that sits near the Surplus threshold (ex: in the 0-250 order segment with 2 pallets when 1 pallet is the Surplus threshold), the pallets used each day are what will be counted towards the bill.

 

In the above example, the 1 pallet will be charged using the On-Demand pricing and the additional pallet will be charged using Surplus pricing. As that single Surplus pallet depletes, less and less Surplus pricing will be billed daily. Since only Surplus is billed at an elevated rate, a very small portion of the product would be billed at an increased cost for each day's calculations that it is in stock.

 

Another way to look at it - if that single Surplus pallet ships out in its entirety for FBA the day after it is received at a Saltbox location, you will only see one day of Surplus pricing for that pallet.

 

Q: If my first month storing with Saltbox is a partial month, how will my order segment be chosen for the Surplus pricing? 

A: We'll use the average orders you do a day to generate an order per month estimate for your very first month. For example, if you are storing and shipping with Saltbox for 10 days out of a 30 calendar day month and have 50 orders during this time, we'll assume you would have done 150 orders with us if you had been shipping the entire month (5 orders/ day for 20 more days). We know there is normally a slight backlog of orders to process when you start with a provider so this should give you a fair represented total for the month. All subsequent months will use the two-month check process.

 

Q: I have multiple brands with Saltbox. How is my order segment determined per brand?

A: If each brand has its own ShipHero account, then each brand will be assigned its own order segment and have its own corresponding storage limit. If all of your brands and channels are managed within one Shiphero account, your order segment will be the total orders produced for that Shiphero account

Members with Multiple Locations 

Q: I am storing in multiple Saltbox locations and do different amounts of orders from each location. Which order segment will I be placed in and what will my Surplus threshold be at each location? 

A: Saltbox will place you into an order segment based on the total number of orders you process across our entire network so that you are not penalized by variations in geographic demand. For example, if in one location you sell 50 orders per month and at another location, you sell 210 orders per month, your order segment will be 251-500 orders per month, and your Surplus storage threshold cumulatively across the network will be the thresholds for that segment.

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