Landed Cost Calculator: How to Know Your True Cost Per Unit Before It Arrives

What landed cost is and why it matters#

Landed cost is the total cost of a product from the moment you place the order with a supplier to the moment the goods arrive at your warehouse ready for sale. It includes every cost incurred in that journey: purchase price, international freight, import duty and customs processing, port handling and unloading, inland transport, insurance, and currency conversion costs. Many importers calculate gross margin using only the supplier invoice price — dramatically overstating their true margin. The difference between the invoice price and the true landed cost is what we call the margin illusion.

The full cost stack, component by component#

Product cost: the supplier invoice price. International freight: ocean or air freight from supplier to port of entry — quoted per container, per cubic metre, or per kilogram. Import duty: a percentage of the customs value (CIF — cost plus insurance plus freight), at the rate for your commodity code and country of origin. Customs clearance fees: agent fees of £150-400 per shipment. Port handling: terminal handling, unloading, and examination fees. Inland transport: from port to your warehouse. Insurance: typically 0.1-0.5% of cargo value. Currency cost: the FX spread and conversion fees on your currency transaction.

The landed cost per unit calculation#

Landed cost per unit = Total shipment cost including all components divided by units shipped. Example for 1,000 units: Supplier cost £8,000 + freight £1,200 + duty 12% on CIF (£9,400) = £1,128 + customs clearance £250 + port and inland £350 + insurance £47 + FX cost £160 = Total £11,135. Per unit: £11.14. If your selling price is £29.99, your gross margin is not 73% (using only supplier cost) but 62.8% (using landed cost). On thin-margin products the gap is far more severe.

How to find your import duty rate#

Import duty rates are set by government and applied based on your product's commodity code (HS code) and country of origin. In the UK, look up duty rates using the Trade Tariff at gov.uk — enter your HS code and origin country to find the applicable rate. For goods from FTA partner countries (the EU, Canada, Singapore, Australia and others) reduced or zero rates may apply if rules of origin are met. Getting your HS code wrong creates customs compliance risk.

Using AskBiz Landed Cost Calculator#

AskBiz's Landed Cost Calculator takes your shipment data — supplier invoice, freight quote, duty rate, and FX rate — and calculates true landed cost per unit automatically. As exchange rates move it recalculates the FX component and shows how your margin is affected. On Growth and Business plans it pre-fills from your connected data — pulling typical freight rates, duty rates, and recent FX history — so you calculate landed cost in seconds rather than building it manually each time.