Inventory storage is how and where a business keeps its stock until it sells. It covers the equipment, such as shelves, bins, pallets and fridges, each product's place and the conditions it needs. Done well, every product has one labelled place, stays dry and cool enough, and can be counted without moving anything.
This guide matches each kind of storage to the goods it suits and sets out the store-room rules from the USAID Logistics Handbook. It turns label words into degrees, and ends with three layouts, an Accra example in cedis and the ArmPOS set-up.
Types of inventory storage, and the goods each suits
Pick from the seven types below by the goods: their size, how often they sell and the conditions on their label. A small shop may need only two or three.
| Storage | Suits | Watch out for |
|---|---|---|
| Shelving units | Cartons and loose items picked by hand, in back rooms and small warehouses | The weight each shelf takes; wooden shelves draw termites |
| Bins and drawers | Small items sold one at a time: screws, phone accessories, sachets | One product per bin, labelled on the front |
| Pallet racking | Full cartons and heavy goods moved by pallet jack or forklift | Anything above hand height needs a forklift |
| Floor stacks on pallets | Sacks and cartons that stack well: sugar, flour, cement, crates of drinks | Bottom cartons crush when stacks go too high |
| Cold storage | Dairy, meat, vaccines, insulin and anything labelled for a fridge | Power cuts: keep a backup and a thermometer |
| A locked cage or cabinet | Phones, spirits, airtime vouchers and controlled medicines | Who holds the key, and a weekly count |
| Records of each product's place | Every type above, in inventory software or a list | They drift unless every move is entered |
How to choose storage for each product
Ask six questions about each product, in this order. An earlier answer outranks a later one: a fridge line goes cold even if it sells fast.
- What does its label say? Storage words such as "cool place" have exact limits, set out below.
- Is it dangerous? Kerosene, gas and spirits go apart from other goods, near a fire extinguisher. Insecticides and cleaning chemicals stay away from food and medicine.
- Is it worth stealing? Small, valuable goods go in a locked cage, counted weekly.
- How big and heavy is it? Heavy goods go low, on a pallet or the bottom shelf. Small items go in bins, so they don't spread across a shelf.
- How often does it sell? Fast sellers go at hand height near the door, slow ones higher or further back. Inventory turnover measures the pace, and warehouse slotting works out each product's exact place.
- Does the room have height to spare? Go up before you rent more floor. The Accra example below prices the difference.
Store-room rules that keep stock sellable
The storage table in the USAID Logistics Handbook holds for any store room, from a pharmacy cupboard to a distributor's warehouse. Its measurements for floors, walls and stack heights are in how to make inventory more efficient. These are the other rules.
- Keep the room dry, shaded and ventilated. Heat and direct sun shorten shelf life; where air conditioning costs too much, the handbook suggests ceiling fans or forced ventilation.
- Fix leaks before anything else. Water ruins packaging even when the product survives, and goods in damaged packaging don't sell.
- Use metal shelving. The handbook prefers it "because wood shelving may attract termites".
- Keep extinguishers near the doors, and buckets of sand where there are none. Store flammable goods apart, next to one.
- Stack cartons with the arrows up, and turn labels and expiry dates to face the aisle.
- Put the earliest expiry where it is easiest to reach, so it leaves first. That is FEFO, first expired, first out.
- Mark a spot for damaged and expired goods, away from stock you sell, and empty it often.
- Lock the store and limit who goes in. Keep food and drink out, and clean on a schedule, because rodents and insects eat packaging.
The handbook adds that a small health centre may have only a cupboard for its stock. The rules still apply, scaled down: small shelves off the floor and away from outside walls may be enough.
What the storage words on a label mean
The storage words on a label have exact limits. WHO's good storage and distribution practices give them for medical products, and the same words appear on many food and cosmetic labels.
| The label says | Keep it at |
|---|---|
| Store at controlled room temperature | 15 to 25°C |
| Store in a cool place | 8 to 15°C |
| Store in a refrigerator, or chilled | 5°C, give or take 3: from 2 to 8°C |
| Store in a freezer | −20°C, give or take 5 |
| Store in a dry place, or protect from moisture | No more than 60% relative humidity |
| Store under ambient conditions | 15 to 30°C, well ventilated, no more than 60% humidity, away from strong light and smells |
| Protect from light | In the maker's original light-resistant pack |
Ambient ends at 30°C, and a tin roof can push a store room past it in the hot months. Hang a thermometer with a humidity reading, and check it at the hottest time of day.
A fridge holds its 2 to 8°C only while it has power. Plan for outages with a generator, a solar backup or cool boxes, and keep the door shut while the power is off.
How to lay out a store room
Lay the room out around its doors: where goods come in, and where they leave for the shop floor or the van. Three layouts cover most store rooms.
| Layout | Use it when | How it works |
|---|---|---|
| U-shape | The room has one door, as most back stores do | Shelving on three walls and one aisle down the middle. Fast sellers sit nearest the door, bulk at the far wall, and deliveries are checked just inside. |
| Straight through | Deliveries come in at the back and goods leave at the front | Goods move one way, from the delivery door to the shop door. Fast sellers sit by the exit. |
| Parallel aisles | The room is big enough for several rows of shelving or racking | A main aisle runs past the doors, with rows of shelving off it. Each row gets a letter and each shelf a number. |
Whatever the layout, mark out five zones: receiving, general stock, cold, locked, and damaged or expired. Keep chemicals on their own shelf, below and away from food.
Then code every place: a letter for each row of shelving and a number for each shelf, such as A1 and B2. Write the code on the shelf edge. Larger stores add the zone, as warehouse management shows.
Label the products too. A scan then confirms the right item, and barcode labels rather than RFID tags suit a small store room.
For example: what shelving saves in an Accra store room
For example, a cosmetics wholesaler in Accra rents a store room of 4 m by 5 m for GHS 2,400 a month. Half the floor goes to aisles and the door, leaving 10 m² to store on. The figures are illustrative, not a real business's.
Rent per square metre of storage floor = 2,400 ÷ 10 = GHS 240 a month. Lotions and perfumes in light cartons can't be stacked high, so on the floor each square metre holds one layer.
| Storage | Floor used | Area to store on | Rent a month | Rent per m² stored |
|---|---|---|---|---|
| Laid out on the floor, one layer | 2.5 m² | 2.5 m² | 600 | 240 |
| A shelving bay 1 m wide, 0.5 m deep, 5 shelves | 0.5 m² | 2.5 m² | 120 | 48 |
Each bay frees 2 m² of floor, worth GHS 480 a month. If a bay costs GHS 1,500, it pays for itself in 1,500 ÷ 480 = 3.1 months; ask your supplier for a real quote.
Rent is one part of what stock costs to keep. Investopedia puts carrying costs at 20% to 30% of inventory value, and our inventory holding cost example for a Kampala shop on bank credit lands near 40%.
Inventory storage mistakes that cost money
Six mistakes cause most storage losses. Each has a sign you can see in a walk round the store room, and a fix.
| Mistake | What you see | The fix |
|---|---|---|
| Too much stock | Cartons in the aisles; cash tied up in slow lines | A reorder point and a maximum for each product |
| The wrong storage for the goods | Sagging shelves; fast sellers out of reach | Match each product to a type, as in the first table |
| No codes or labels | Staff search, and pick the wrong size or flavour | A code on every shelf, recorded for every product |
| No regular counts | Gaps found only at the year end | Count one section a week |
| A layout that ignores the doors | Staff cross the room for the best sellers | Fast sellers next to the exit door |
| No room to grow | Goods spill into aisles at the busy season | Size the room for peak stock, not average |
How to set up inventory storage in ArmPOS
ArmPOS records where each product is kept, down to the rack and shelf, and lists products by location. You design the layout and write the shelf codes; ArmPOS keeps the record of which product sits where.
- Code every rack and shelf. In Settings › Warehouse Locations, click Create and choose the Warehouse. Enter a Rack/Location Code such as A1, and a Location Name such as Front shelf (Your warehouse and its locations).
- Give each product its place. Fill Internal Location (Rack/Shelf) on the product's Edit page. Reports › Internal Location Report then lists products by location (Stock reports).
- Treat a separate store as its own warehouse if your plan allows more than one. Each keeps its own stock. On plans with transfers, a transfer moves stock between them once someone with permission approves it (Move stock between warehouses).
- Label the products. Products › Print Labels prints labels with each product's name, price and a barcode of its code, on sheets or stickers (Print barcode labels).
- Keep dates in view. With Track batches & expiry on, Products › Batches colours each batch's expiry date: red once expired, amber when it expires soon (Batches and expiry dates).
- Take damaged goods out of stock. Damages › Create Damage removes broken or spoiled stock with a note of what happened, and books nothing in Accounting (Record damaged or spoiled stock).
- Count one shelf at a time. Products › Count Stock makes a count sheet for one warehouse and category (Count and adjust stock).
See what ArmPOS includes for shops in Ghana.
Frequently asked questions
What are the main types of inventory storage?
Shelving, bins and drawers, pallet racking, floor stacks on pallets, cold storage and locked storage. A record of each product's place goes with all of them.
How do you organize stock in a small store room?
Give every product one coded place, with fast sellers by the door and heavy goods low. Put the earliest expiry in front, and keep damaged goods in a marked spot.
What does "store in a cool place" mean?
Between 8 and 15°C, in WHO's recommended storage conditions. "Store at controlled room temperature" means 15 to 25°C.
How much does inventory storage cost?
Rent, power and handling are part of a carrying cost that Investopedia puts at 20% to 30% of inventory value. Shelving cuts the rent per square metre stored, as the Accra example shows.
What is the difference between inventory storage and warehouse slotting?
Storage decides how goods are kept: on what, in what conditions, under what rules. Slotting decides where each product goes, by how fast it sells.
Walk your store room this week with a notepad, and give every shelf a code and every product one place. To record each product's rack and print its barcode labels, create a free ArmPOS account.
