Recurring Storage Billing

Charging customers for using warehouse space is a fundamental part of warehouse operations. A customer may contract to lease a portion of a building at a fixed price, but the more common practice, supported by law and contract, is to charge a periodic recurring storage fee for each unit of product on hand.

Recurring Calendars

Each customer account requires a calendar to schedule recurring storage calculations. While it is customary to calculate recurring on the last day of each calendar month, recurring can be calculated on other schedules.

WARES can perform the recurring billing at any time. When the recurring process is selected, WARES first displays a list of recurring calendars to use. This list displays all the calendar schedules with a calculation Next date less than or equal to the current Run date. Recurring calendars with dates following the Run date are not displayed and cannot be run.

Recurring Calculation Methods

Recurring storage is determined either by periods or by the monthly anniversary of the day lots are received, as described following:

Periodic Recurring

Where an account’s recurring balances are calculated by period, all lots for the account will use the same anniversary starting and ending dates, which are determined by the account’s recurring calendar. The lot anniversary Starting date will be one day greater than the Last date of the account’s recurring calendar, and the Ending date will be the Next date of the account’s calendar.

Once lot balances are calculated, there are two options for determining charges with period recurring: using ending balances (advance billing), or using starting balances (arrears billing). There are a few southern warehouses still clinging to arrears billing, and so WARES supports this deprecated business method.

Anniversary Recurring

Where balances are calculated by anniversary, the lot anniversary Ending date will be the day within the calendar Last+1 to Next interval which is one less than the anniversary day. The lot’s anniversary Starting date will be the previous month day equivalent to the Received day.

When using anniversary method, the recurring calendar must be monthly, but the month may be divided up into weeks or other intervals. When only a portion of a month is calculated, only lots with storage months ending within that portion will be included in the calculation.

Anniversaries and Freedays

Anniversaries are calculated from the date a lot of goods is Received into the warehouse. When an account has free days, the free days add to the transaction Posted date to determine the Received date.

When an account has freedays and a lot’s Received date falls within the recurring calculation interval, the lot Starting date is set to the Received date and receiving storage is applied to the corresponding starting balances. And since the Received date is used as the Starting date, transactions posted prior to the Starting date are excluded from a recurring audit.

Also, when the Starting date is the Received date, the Ending date is left blank, since it will be processed in the next month. Put another way, when anniversary storage is used, receiving and recurring charges for a lot cannot occur in the same month. First goods are Received, and then anniversaries are used for the lot Ending date and recurring storage is applied in subsequent months.

Periodic Method and Freedays

When freedays expire with periodic recurring, The Received date is used for the Starting date, and starting balances are used to calculate receiving storage. Hence when freedays expire in periodic recurring, a lot’s calculation Starting date will not be the beginning of the recurring period.

For lots received with freedays, if the periodic storage is based on starting balances, then the Ending date is left blank and no recurring is calculated for the lot. When periodic storage is calculated from ending balances, the Ending date is filled and ending balances are used to calculate recurring as usual.