Sourcing glossary
Landed cost
Also known as: Total landed cost, Landed cost per unit
The total cost of getting imported goods to your warehouse, including product price, freight, insurance, duty, fees, brokerage and delivery, usually expressed per sellable unit.
Landed cost is the number to compare suppliers on, not the unit price on the quote. A low EXW price can end up more expensive than a higher FOB or DDP price once inland China costs, freight and import charges are added.
Duty is part of landed cost, and its base differs by country: the US applies duty to the price excluding international freight and insurance, while the EU and UK include freight and insurance up to the border. Import VAT counts as a cost only if you cannot reclaim it.
See how to calculate landed cost for a worked example.
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Guides that use this term
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Compliance
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A step-by-step landed cost formula for China imports: product cost, freight, insurance, duty, VAT, fees and delivery, with why US and EU/UK duty bases differ.
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