Rent is where a cold store earns its money, and also where most disputes with depositors start. A grower brings 4,000 bags of potato in March, takes 1,200 out in July and the rest in October. How much does he owe? The answer depends on the rent method you agreed, and on whether you bill on what came in or on what actually stayed.
The four common rent methods
1. Per bag for the season
One fixed rate per bag for the whole storage season, whatever the date of release. It is simple and depositors understand it. The bill is the number of bags received multiplied by the season rate.
Example: 6,000 bags at PKR 450 per bag for the season = PKR 2,700,000.
The risk for the store owner: a depositor who empties his lot in June pays the same as one who stays until December, while your electricity bill does not care about the agreement.
2. Per bag per month
The fairest method for both sides when releases happen through the season. Rent follows the bags that are actually in your chambers. The cleanest way to calculate it is in bag-months: add up the bags in store on each day of the period and divide by 30.
Example: 4,200 bags from 1 June to 20 July (50 days), then 3,000 bags from 21 July to 31 August (42 days).
- 4,200 × 50 = 210,000 bag-days
- 3,000 × 42 = 126,000 bag-days
- Total 336,000 bag-days ÷ 30 = 11,200 bag-months
- At PKR 55 per bag per month: 11,200 × 55 = PKR 616,000
Compare that with billing the full 4,200 bags for three months: 4,200 × 3 × 55 = PKR 693,000. The difference is exactly the kind of number a depositor will argue about, and with daily counting you can show him the working.
3. Per ton per month
Used for produce stored in crates of different weights, such as kinnow or apples. Multiply the bag-months (or crate-months) by the average weight and divide by 1,000 to get ton-months.
Example: 3,000 crates of 18 kg for 70 days = 3,000 × 70 ÷ 30 = 7,000 crate-months. 7,000 × 18 ÷ 1,000 = 126 ton-months. At PKR 1,500 per ton per month = PKR 189,000.
4. Flat amount per month
A fixed monthly charge for a reserved chamber or space, regardless of how full it is. Common for traders who rent a whole chamber.
Rules that prevent disputes
- Agree the method in writing when the lot comes in, and write it on the receipt.
- Count the release day as a storage day. Bags released on 20 July were in store that morning.
- Bill in periods that follow on: each bill starts the day after the previous one ended, so nothing is billed twice.
- Apply payments to the oldest bill first, so the depositor's statement always makes sense.
- Never release without a gate pass that names the lot, the marka and the quantity.
Doing it without a calculator
Counting bag-days by hand for fifty depositors is where registers go wrong. FarmOS Cold Storage does it for every lot from the movements you already record, shows the working on each bill, and bills every rental lot at month end in one click.