FD FeeDeck

Guide

How to Calculate Landed Cost

Supplier price is almost never the real floor. Landed cost is the number that matters once freight, duty, and import overhead are attached to the unit. If you price from supplier cost alone, the missing layers usually show up later as margin disappointment.

  • Build the full import cost base first
  • Separate supplier price from real saleable cost
  • Use landed cost to set a believable price floor

Step 01

Start with supplier price, but do not stop there

Supplier cost is only the opening number. It tells you what the factory or vendor charges, not what it costs to make the unit saleable in your actual business.

What belongs here

  • Unit purchase price from the supplier
  • Factory-ready or ex-works cost assumptions
  • The real cost per unit, not a rounded headline price

Step 02

Add inbound shipping and freight first

Freight is part of the unit cost even if it lands on a different invoice. If the item cannot reach your warehouse without that spend, it belongs in landed cost.

Interim landed base = Supplier cost + Inbound shipping

Many products look healthier than they are because freight is kept in a separate mental bucket. Pulling it into the unit economics early gives you a cleaner price floor.

Step 03

Layer in duty and other import overhead

Duty, brokerage, inspection, insurance, and similar overhead often feel secondary until they are spread across the batch. At that point they become very real, and they belong in the unit economics before the selling price is set.

Common overhead items

  • Customs duty
  • Broker and clearance fees
  • Inspection and insurance
  • Import admin cost

Why it matters

  • These costs shift the real price floor upward.
  • They compress margin before ads even start.
  • They change the break-even ROAS of the product later.

Step 04

Use landed cost to set the selling floor

Once the full landed cost is clear, use that number to calculate the selling price required for the margin you actually need. That keeps the product from entering the market with a weak floor.

Good habit

Rework landed cost whenever freight, duty, or batch size moves. The product can stay in the same catalog while the economics underneath it change materially.