> ## Documentation Index
> Fetch the complete documentation index at: https://docs.vortexiq.ai/llms.txt
> Use this file to discover all available pages before exploring further.

# Inventory Carrying Cost, Microsoft Dynamics 365

**Metrics type:** [Card](/nerve-centre/overview#metrics-types-explained)

> Estimated cost of holding aged inventory. Joined with commerce sell-through to flag dead stock with cash impact.

## At a glance

> Annualised cost of holding inventory: capital + warehousing + obsolescence. `Total Inventory Value × Carrying Rate %`. Default carrying rate 22% (industry mid-market median).

|                    |                                                                                                                                                                                      |
| ------------------ | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ |
| **What it counts** | `SUM(Total Inventory Value) × Carrying Rate`. Carrying rate breakdown: cost of capital (10%) + warehousing (5%) + insurance (1%) + obsolescence (4%) + shrinkage (2%) = 22% default. |
| **Currency**       | Reporting Currency.                                                                                                                                                                  |
| **Time window**    | `30D` (rolling annualised)                                                                                                                                                           |
| **Roles**          | owner, finance                                                                                                                                                                       |

## Calculation

Calculated automatically from your Microsoft Dynamics 365 data. See the At a glance summary above for what the metric tracks and the worked example below for a typical reading.

## Worked example

UK apparel brand on BC, snapshot 14 Apr 26.

| Component                            | Value        |
| ------------------------------------ | ------------ |
| Total Inventory Value                | £2,622,000   |
| Annual Carrying Rate                 | 22%          |
| **Annual Carrying Cost (this card)** | **£576,840** |
| Monthly impact                       | £48,070      |

Reducing dead stock (£284K) by 50% saves £31K/year in carrying cost.

## Sibling cards merchants should reference together

| Card                                                                                          | Why pair                   |
| --------------------------------------------------------------------------------------------- | -------------------------- |
| [Total Inventory Value](/nerve-centre/kpi-cards/microsoft-dynamics/msd-total-inventory-value) | The denominator.           |
| [Dead Stock Value](/nerve-centre/kpi-cards/microsoft-dynamics/dead-stock-value)               | Highest carrying cost.     |
| [Inventory Turnover](/nerve-centre/kpi-cards/microsoft-dynamics/inventory-turnover-ratio)     | Velocity reduces carrying. |

## Reconciling against the vendor's own dashboard

**Where to look in Business Central:**

BC does not natively compute carrying cost. The Inventory Valuation report gives the numerator; the carrying rate is workspace-configured.

**Why may differ:**

| Reason                        | Direction | Why                            |
| ----------------------------- | --------- | ------------------------------ |
| **Carrying rate**             | Either    | Default 22%; merchant-specific |
| **Multi-Company aggregation** | Card sums |                                |

**Cross-connector reconciliation:**

No commerce-side counterpart.

## Known limitations / merchant FAQs

**Carrying rate components?**
Cost of capital (10%) + warehousing (5%) + insurance (1%) + obsolescence (4%) + shrinkage (2%) = 22% default. Tunable.

**Industry benchmarks?**
Apparel: 20-30%. Electronics: 15-25%. Industrial: 10-20%.

**What changes the rate?**
Higher interest rates raise cost of capital. Higher warehouse rents raise warehousing. Configure annually.

***

### Tracked live in Vortex IQ Nerve Centre

*Inventory Carrying Cost* is one of hundreds of KPI pulses Vortex IQ tracks across Microsoft Dynamics 365 and 70+ other ecommerce connectors. Nerve Centre runs the detection layer; Vortex Mind investigates the cause when something moves; Ask Viq lets you interrogate any number in plain English.

[Start for free](https://app.vortexiq.ai/login) or [book a demo](https://www.vortexiq.ai/contact-us) to see this metric running on your own data.