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Landed cost and logistics
Landed cost calculator: what an imported unit really costs
Enter the supplier price, the freight and insurance, your duty rate and the fees you pay on arrival. You get the landed cost of the whole shipment and of each unit.
Landed cost is the goods price plus freight, insurance, customs duty and the other fees you pay to get stock to your door. At the default numbers each unit lands at USD 15.71, which is 25.7% above the supplier price.
Written by Procurement VMS Editorial Team · Reviewed by Michael, Procurement Advisor Expert · Updated
Your numbers
The boxes start with an example so you can see how it works. Replace them with your own figures.
Your result
The shipment costs USD 15,707 delivered, or USD 15.71 a unit. That is 25.7% above the USD 12.50 supplier price, and duty accounts for USD 937 of it.
| Goods value | USD 12,500 |
|---|---|
| Value duty is charged on | USD 14,420 |
| Customs duty | USD 937 |
| Total landed cost | USD 15,707 |
| Landed cost per unit | USD 15.71 |
| Extra over the supplier price | 25.7% |
The currency box changes the label only. Enter amounts in the currency you choose.
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How the landed cost calculator works
The formula
Landed cost = goods + freight + insurance + customs duty + other fees. Duty = customs value x duty rate. Landed cost per unit = landed cost / units.
The supplier quote is the start of the price, not the end. Freight, insurance, duty and fees are added on the way in, and they hit different quotes by different amounts. A low unit price from a distant supplier can land above a higher price from a near one.
Get the duty base right. Many customs systems charge duty on the cost, insurance and freight value, so freight raises the duty as well as the freight bill. Your customs broker can confirm which basis your country uses for your product.
The example numbers are illustrative and are not benchmarks. Use your own data for any decision.
How to use it with your own data
- Enter the quoted price and the total shipment size, then add the full freight bill for that shipment.
- Set the duty rate from the tariff code for your product, and pick the valuation basis that applies in your country.
- Compare the landed cost per unit across suppliers, not the quoted prices, and check the duty with the import duty calculator.
Mistakes that skew the answer
Comparing quotes instead of landed costs
Ex works, FOB and delivered quotes cover different things. Put them all on the same delivered basis first. The trade terms guide explains who pays for what.
Leaving out the small fees
Brokerage, terminal handling, documents and inland haulage often add several percent. List them from a past shipment.
Using a flat duty rate for a mixed shipment
Each product code carries its own rate. Split the shipment by code and add the results.
What to do with the result
Set your cost of capital against the transit time with the inventory carrying cost calculator, because stock on a ship is cash you cannot use. Keep the paperwork straight with a correct commercial invoice and a packing list, and see the total cost of ownership guide for costs beyond delivery.
Questions about the landed cost calculator
What is included in landed cost?
The goods price, freight, insurance, customs duty and the fees you pay to bring stock to your site, including brokerage and port handling.
Is VAT part of landed cost?
Only if you cannot recover it. Where import VAT is reclaimed later, leave it out. Where it is not, add it as a cost.
How do I split landed cost across several products?
Share freight by weight or volume and insurance and fees by value, then apply each product duty rate to its own value.
What is the difference between landed cost and total cost of ownership?
Landed cost stops when stock reaches your door. Total cost of ownership adds storage, handling, failure, support and disposal over the life of the item.