Free Tool

How Much Is Your Inventory Really Costing You?

Most companies don't realize they're spending 30%+ annually just to hold inventory. Calculate your hidden costs in 60 seconds.

Understanding Your True Inventory Costs

Every piece of inventory sitting in your warehouse is costing you money, even if the purchase price is already paid. Inventory carrying costs typically range from 20% to 35% of inventory value annually.

Enter your part details below to see exactly how much you could save by transitioning to digital inventory.

Carrying Costs (25%)

Cost of capital, insurance, handling, and management overhead tied to inventory.

Storage Costs (3%)

Warehouse space, utilities, equipment, and logistics expenses.

Obsolescence Risk (3-15%)

Risk of parts becoming outdated, damaged, or unsellable over time.

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Calculate Your Savings

Enter details for one part to see what digital inventory could save you.

Your results appear instantly. We'll also send a summary you can share with your team.

Free analysis delivered within 24 hours

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FAQ

Common
questions.

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What is inventory carrying cost?
Inventory carrying cost (also called holding cost) is the total expense of storing unsold inventory. It typically includes cost of capital (opportunity cost of tied-up money), insurance, handling, management overhead, and typically ranges from 20-30% of inventory value annually. Our calculator uses industry-standard rates to help you understand your true costs.
How do you calculate inventory ROI?
Inventory ROI is calculated by dividing the gross profit from inventory by the average inventory cost, then multiplying by 100. Our calculator helps you understand the hidden costs of holding inventory including carrying costs (25%), storage costs (3%), and obsolescence risk (3-15% depending on demand variability).
What is digital inventory?
Digital inventory is a modern approach where you store product designs digitally (as CAD files) instead of physical parts. When an order comes in, the part is manufactured on-demand locally using technologies like 3D printing or CNC machining. This eliminates carrying costs, storage fees, and obsolescence risk while reducing lead times from weeks to days. Learn more about digital inventory.
How much can I save with digital inventory?
Savings vary based on your inventory value, demand patterns, and obsolescence risk. Most manufacturers save 25-40% of their current inventory holding costs by switching to digital inventory. Parts with high unit costs, unpredictable demand, or long overseas lead times typically see the greatest savings.
What types of parts work best for digital inventory?
Digital inventory works best for slow-moving parts, spare parts, legacy components, and items with unpredictable demand. Parts with high carrying costs, long lead times from overseas suppliers, or significant obsolescence risk are ideal candidates.
How accurate is this calculator?
This calculator uses industry-standard rates for carrying costs (25%), storage costs (3%), and obsolescence risk (3-15%). While these are reliable benchmarks used by supply chain professionals, your actual costs may vary. For a more detailed analysis tailored to your business, book a discovery call.