Landed Cost
Landed cost is what a unit truly costs by the time it’s sellable: product, freight, duties, and fees combined.
What landed cost is
Landed cost is what a unit truly costs by the time it’s sellable: the product price plus freight, duties, taxes, insurance, and handling fees, all the way to your shelf.
Why landed cost matters
Margins calculated on the factory price alone are fiction: the gap between unit price and landed cost is where profitable-looking products quietly lose money. Pricing, supplier comparisons, and channel decisions all need the real number.
What goes into landed cost
- Product cost from the supplier
- Freight, per unit share of the shipment
- Customs duties and import taxes
- Insurance, brokerage, and handling fees
Frequently asked questions
Why do landed costs surprise merchants?
The costs arrive separately: the supplier invoice now, freight later, duty at the border, fees after. Only adding them per unit, per shipment, shows what the goods actually cost.
How do you compare suppliers on landed cost?
Quote the full journey, not the unit price: a cheaper factory further away can land more expensive after freight and duty. The comparison is shelf-to-shelf.
Related terms
Freight · Customs Duty · MOQ