The most crucial step in coming up with a wholesale or retail cost is fully understanding your product and importing costs. Our detailed landed cost calculator will send you on a path to profitability. Accurately estimating your landed cost will help you come up with a wholesale or selling cost so you can be competitive with your product in the marketplace while making enough margin to be profitable. Check out our wholesale price calculator which expands on this landed cost calculator.
This total landed cost calculator is the same style that I’ve been using for over a decade. Of course, I had to do my calculations in excel instead of a neat online calculator, and it is the start of the road to becoming profitable. I’ve used these same core principles to accurately generate pricing for countless retailers such as Amazon, Walmart, Macy’s, Bed Bath & Beyond, Target, and many more…
Read the tutorial and watch the video below the landed cost calculator so you know how this calculator should be used and how data should be entered for the best results.
The unit cost is the Agreed upon price that you pay your factory. This field is required to make an accurate calculation of your landed cost.
Master Carton Information
Knowing the master carton dimensions and cube (Cubic Meters – CBM) is vital to determining the shipping cost for each unit. The number of pieces per master carton and the size of the master carton will be used to calculate a final freight rate. In our landed cost calculator we are assuming a 40 standard dry container for shipping costs. It is important to note that our calculation is using 56 CBM which is actually less than a full container. I do this because you can never fully load a container where you are not shipping air and wasting space. Based on my experience 56 CBM is a good approximation for what the capacity of a 40 foot container would actually be.
Master Carton Length – Inches (Required Unless You Know Your CBM):
The master carton length should be entered in inches. If you do not have this information you will need to manually enter your master carton CBM in the Master Carton CBM field below.
Master Carton Width – Inches (Required Unless You Know Your CBM):
The master carton width should be entered in inches. If you do not have this information you will need to manually enter your master carton CBM in the Master Carton CBM field below.
Master Carton Height – Inches (Required Unless You Know Your CBM):
The master carton height should be entered in inches. If you do not have this information you will need to manually enter your master carton CBM in the Master Carton CBM field below.
Master Carton CBM (Calculates from Master Carton; CBM Can Be Manually Entered):
This field is required in order for your freight rate to calculate to generate a landed cost. If you do not know your master carton dimensions than you can enter your master carton CBM to generate a landed cost.
Container/Shipping Cost
The container or shipping cost is important to calculate the amount you pay for freight per unit. You will be able to get this information from your freight forwarder. The more accurate your shipping cost is from your freight forwarder the more accurate your landed cost will be. If you are shipping a less than container load shipment (LCL) make sure that any additional fees and costs are included.
Duties and Tariffs
Duties and tariffs will be a critical factor when calculating your estimated total landing cost. It is important to note that you should verify the HTS code with a licensed customs broker to make sure that you accurately define what duties and tariffs you need to pay.
Duty Rate Percentage
The duty rate percentage is the amount of duty you will pay to customs. You can get your duty rate by working with your freight forwarder or asking your factory what HTS code they normally use for your product type. However, it is always best to verify your HTS code and the duty rate with a licensed custom broker. You definitely don’t want to get this wrong because if your duty is challenged you could end up owing the government money based on a wrong classification. The duty percentage is calculated off of your unit cost on your commercial invoice, and this tool works well as a customs cost calculator.
Tariff Rate Percentage
The tariff rate percentage is the amount of duty you will pay to customs. It is similar to the duty rate, but there is an additional tariff on your product. More than likely, this is due to additional Section 301 tariffs. You can get your tariff rate by working with your freight forwarder or a licensed customs broker as to whether additional tariffs apply to the HTS code you’re using. Like the duty rate, you definitely don’t want to get this wrong because if your tariff rate is challenged you could end up owing the government money based on a wrong classification. The tariff percentage is calculated off of your unit cost on your commercial invoice, and this tool works well as a customs cost calculator.
Miscellaneous Cost Percentage
The miscellaneous cost percentage is an undefined cost that you may want to add if there are additional costs to your product. For example, you may have an overseas agent commission that you need to pay or perhaps you have product testing or product inspection that you may need to include in your landed cost. This field is not required in the total landed cost calculation.
Freight Rate
The freight rate will automatically calculate once you hit the calculate button. Your freight rate will be factored taking your unit cost, master carton information and CBM, shipping costs, duties, and tariffs into consideration
Total Landed Cost Estimate
The total landed cost will also be calculate once you hit the calculate button. This estimate will be summed up from your unit cost, master carton information and CBM, shipping costs, duties, tariffs, any miscellaneous costs, and the calculated freight rate. This will be the number that you want to use as your estimated landed cost to start calculating your wholesale or selling cost.
Conclusion
When you’re trying to calculate your total landed cost and how to calculate your transportation cost you want to be as accurate as possible. Knowing how to calculate the landed cost of imported goods is the key first step to profitability for your item and your business. Our landed cost calculator will help you get well on your way to give you a good landing estimate.
