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How to calculate the landed cost of imported goods

The factory price is only part of what you pay. Here is how to calculate the real cost of goods at your warehouse.

6 min read

Landed cost is the total cost of a product until it arrives at your warehouse. Comparing suppliers by factory price alone often leads to wrong decisions.

The components

Product price on the agreed delivery term. Inspection and sample costs. Packing and pallets if not included. Freight and insurance. Import duties, which depend on the customs code and origin. Import VAT or sales tax, often recoverable for companies. Customs broker and terminal fees. Local delivery to your warehouse. Bank charges and currency conversion.

Duties depend on the customs code

The same product can fall under different codes with different duty rates. Check the code before ordering, and ask whether trade agreements reduce the duty for the country of origin.

Compare on the same basis

A supplier quoting EXW and one quoting DAP cannot be compared directly. Bring all offers to the same delivery term before comparing.

Per unit cost

Divide the total landed cost by the number of units to get the real unit cost, and use that number to set your selling price.

Every Nectus quote shows the cost to your address, so you compare real numbers.