Landed cost calculator
Your supplier price is not your cost. Add freight, insurance, duty and fees to see what each unit really costs you, and what is left of your margin.
Know when you can afford the next order
Landed cost tells you what a unit costs. A cash forecast tells you when the money leaves your account. I build 12 month cash and inventory forecasts for ecommerce brands, from $500.
Request a free CFO DiagnosticWhat landed cost includes
Landed cost is everything you pay to get a product from your supplier into your warehouse, ready to sell. For most importers that means:
- Supplier price for the goods (the invoice value).
- International freight: ocean, air or courier, from the supplier to the port of entry.
- Cargo insurance, if you buy it.
- Import duty, a percentage set by your product's tariff code and country of origin.
- Customs broker and clearance fees, plus government processing fees where they apply.
- Port and handling charges: terminal fees, demurrage if the container sits too long, palletizing.
- Delivery to your warehouse or 3PL, sometimes called drayage for containers.
Costs that happen after the goods reach you, like outbound shipping to customers, payment fees and ads, are not landed cost. They belong in your order economics, which the break even ROAS calculator covers.
The formula
Duty itself is calculated on a base that depends on the importing country:
Duty = duty rate × (product value + freight + insurance) (UK, EU)
This is general guidance, not customs advice. Tariff rates have changed often since 2025 and some products carry extra duties on top of the base rate, so confirm your rate and duty basis with your customs broker before you price.
Worked example
A brand imports 1,000 units at $10 each into the United States. Freight is $1,500, insurance $100, duty 5%, broker fees $250, port fees $50 and delivery to the warehouse $300.
| Product value (1,000 × $10) | $10,000 |
| Freight and insurance | $1,600 |
| Duty (5% of $10,000) | $500 |
| Broker, port fees and delivery | $600 |
| Total landed cost | $12,700 |
|---|---|
| Landed cost per unit | $12.70 |
The real cost is 27% above the supplier price. At a $30 selling price, gross margin is 57.7%, not the 66.7% you would expect from the $10 invoice. That gap is the most common reason a brand that looks profitable on paper keeps running short of cash.
Mistakes that inflate your margin
Booking freight and duty as general expenses
If freight in and duty go to an overhead account instead of inventory, your gross margin looks better than it is and your inventory is undervalued. They should sit in inventory and flow to cost of goods sold as units sell.
Using one average for every product
A light, expensive product and a bulky, cheap one can share a container but carry very different freight costs per unit. Split shared freight by weight or volume, and duty and insurance by value.
Forgetting that the cash leaves first
You usually pay a deposit when you order, the balance before shipping, then freight and duty on arrival, often two to four months before the units sell. Landed cost tells you the price of inventory. A cash forecast tells you whether you can afford it in the month it is due.
Frequently asked questions
What is included in landed cost?
Everything you pay to get a product into your warehouse and ready to sell: supplier price, international freight, insurance, import duty, customs broker and clearance fees, port and handling charges, and delivery to your warehouse.
Is duty charged on the product price or on product plus freight?
It depends on the country. The United States and Canada generally charge duty on the value of the goods without international freight. The UK and the European Union charge duty on the value including freight and insurance (CIF). Confirm the rule and your duty rate with your customs broker.
Should landed cost be part of cost of goods sold?
Yes. Freight in, duty and other costs to bring inventory in should be added to inventory cost and expensed as cost of goods sold when the units sell. Booking them as general expenses overstates your gross margin.
How do I split freight across several products in one shipment?
Allocate shared costs by value when duty and insurance drive the cost, and by weight or volume when freight space drives it. Run this calculator once per product with its share of each cost.