Carrying Costs

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DEFINITION of 'Carrying Costs'

The price of holding, or "carrying," inventory. Carrying costs include storage costs, maintenance (particularly in regard to perishable items), insurance and other less tangible expenses, such as opportunity costs and losses due to theft.

BREAKING DOWN 'Carrying Costs'

One of the great advantages enjoyed by many cyber stores is the lack of carrying costs. Instead, many online retailers stock items as needed or have them all shipped from a central location, as opposed to having inventory at multiple brick-and-mortar locales.

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