Landed Cost Calculator

Spread freight, insurance and duty across every line of a supplier invoice to the cent, convert the currency, and get a true landed unit cost and selling price.

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Total landed cost

$357.00

Freight and charges add 13.5% to the $314.50 of goods, split by value to the cent. No duty rate entered yet: add yours below if the goods pay duty.

Ceramic mug set per unit: $7.38; sell at $14.76
Scented candle per unit: $9.08; sell at $18.16
Greeting cards per unit: $1.42; sell at $2.84
Uplift on goods: 13.5%; freight and charges

Invoice lines

Item, line 1
Quantity, line 1
Unit cost, line 1
Unit weight, line 1
Item, line 2
Quantity, line 2
Unit cost, line 2
Unit weight, line 2
Item, line 3
Quantity, line 3
Unit cost, line 3
Unit weight, line 3

Up to 10 lines. Unit cost in the supplier's currency; any weight unit, only the ratios matter.

Freight, duty and tax

Exchange rate (1 supplier currency = ? USD)

1 if the supplier invoices in your currency.

Freight

Insurance

Amount% of goods

Other charges

Brokerage, port and handling fees.

Split charges across lines

By valueBy unitsBy weight

By value is the usual default. By weight needs a unit weight on the lines.

Import duty rate

From your tariff code: the UK Trade Tariff or the US HTS.

Target margin (optional)

Suggests a selling price from landed cost.

Duty is charged on

Goods only (US, FOB)Goods + freight + insurance (UK/EU, CIF)

Currency

Landed cost per line

Item	Qty	Goods	Charges	Landed unit	Sell at 50%
Ceramic mug set	24	$156.00	$21.08	$7.38	$14.76
Scented candle	12	$96.00	$12.97	$9.08	$18.16
Greeting cards	50	$62.50	$8.45	$1.42	$2.84

Ceramic mug set
Landed unit
$7.38
Sell at 50%
$14.76
Quantity
24
Goods
$156.00
Charges
$21.08
Scented candle
Landed unit
$9.08
Sell at 50%
$18.16
Quantity
12
Goods
$96.00
Charges
$12.97
Greeting cards
Landed unit
$1.42
Sell at 50%
$2.84
Quantity
50
Goods
$62.50
Charges
$8.45

Show the working (first line)

Ceramic mug set: goods:24 × 6.5 = 156
Charges allocated:21.08 freight + 0 insurance + 0 other (largest-remainder, sums to 42.5)
Landed unit cost:177.08 ÷ 24 = 7.3783
Selling price:7.3783 ÷ (1 − 0.5) = 14.76

The Landed Cost Formula

Landed cost per unit = (goods + allocated freight, insurance and fees + duty) / quantity. The per-unit part is what most quick calculations skip. A $500 freight charge on a mixed invoice does not belong to the order as a whole; it belongs to each unit on it, in proportion. Until you push the freight down to the unit, you do not know what any single product cost you, and every margin built on the invoice cost is overstated.

Worked example: a three-line gift invoice

Goods: 24 x $6.50 = $156.00, 12 x $8.00 = $96.00, 50 x $1.25 = $62.50; total $314.50
Freight $42.50 by value: 156 / 314.50 x 42.50 = $21.08 to the mugs
Landed unit (mugs) = (156.00 + 21.08) / 24 = $7.38
Selling price at 50% margin = 7.3783 / 0.5 = $14.76

The mugs cost $7.38 landed, not $6.50, and need a $14.76 price to keep a 50% margin.

Worked example: a UK import with duty and VAT

100 units at $10.00, exchange rate 0.79: goods = £790.00
Freight £100, insurance £10: customs value (CIF) = £900.00
Duty at 5% = £45.00
Import VAT at 20% on (900 + 45) = £189.00, reclaimable
Landed unit = (790 + 100 + 10 + 45) / 100 = £9.45

Each unit lands at £9.45. The £189 import VAT is cash out on arrival but comes back on your VAT return.

Import Duty Calculator for UK Imports

For goods coming into Great Britain, the calculator works as an import duty calculator once you have the duty rate. The rate comes from the UK Trade Tariff: look up the commodity code for each product and use the third-country rate, or the preferential rate if the goods qualify under a trade agreement and you hold proof of origin. Many EU-made goods enter at 0% under the UK-EU Trade and Cooperation Agreement for that reason.

Duty is worked out on the customs value, which in the UK is the goods plus freight and insurance to the border (CIF), so choose the CIF basis above. Import VAT is then charged on the customs value plus the duty. The importer on the declaration needs a GB EORI number; check yours or a supplier's with the EORI number checker.

Why Allocation Method Matters

By value spreads freight in proportion to each line's share of the goods total. It is the right default when a carton of expensive items and a carton of cheap ones weigh about the same, because the expensive goods usually drive the insurance and handling cost. By units spreads freight evenly per piece, which fits when every unit takes similar space, like case-packed drinks or uniform cartons.

By weight is the most physically accurate method for heavy, dense freight, but it needs a weight per line, and vendor invoices rarely carry it. If your invoice lists weights, use them. If not, by value is the standard fallback and the one most accounting teams expect.

Which allocation method to use
Method	Use it when
By value	Mixed goods of similar size; the accounting default
By units	Uniform cartons or case-packed goods
By weight	Heavy or dense freight, and the invoice lists weights

Penny-Exact Allocation

Split $100 of freight three ways and a naive percentage gives each line $33.33: the invoice is a penny short. Across a 40-line invoice, rounding each share on its own can drift several cents either way. That matters the moment the numbers post to a product catalogue, a POS or a GL account that must tie back to the freight on the invoice. This calculator allocates in whole cents and hands the leftover pennies to the lines with the largest remainders, so the shares always add up to the charge you entered.

From Landed Cost to Shelf Price

Landed cost is the number to price from, because it is what the unit actually cost to get onto your shelf. Set a target margin and the calculator solves price = landed / (1 - margin), the correct direction of the formula. For shelf prices with VAT and .99 endings, use the retail price calculator; to check what a price earns, the margin calculator. Shipping by sea? The CBM calculator works out container fit.

From Vendor Invoice to Priced Catalogue

This is the calculation buyers do by hand when a vendor invoice arrives with wholesale costs and no retail prices: type the lines into a spreadsheet, spread the freight, divide by quantity, apply a margin. OrderSync extracts the lines from the invoice so the costs are ready the moment the document lands. Try the invoice extractor on a real document, or see how multi-format document processing handles every format a vendor can send.

Frequently Asked Questions

What is landed cost?

Landed cost is the full cost of getting one unit of product onto your shelf: the vendor's unit price plus that unit's share of freight, insurance, duties and fees. It is always higher than the invoice unit price, and it is the number to use for pricing and margin decisions.

How do you allocate freight across an invoice?

Pick a basis, usually each line's share of the invoice value, its share of total units, or its share of total weight, then multiply the freight by each line's share. Divide the line's share by its quantity to get freight per unit and add that to the unit cost. Round in cents with a largest-remainder pass so the shares add up to exactly the freight charge.

Should I use invoice cost or landed cost for pricing?

Landed cost. Pricing from the invoice cost ignores freight and duties, so your real margin is lower than the margin you think you set. On invoices where freight runs 5 to 10% of goods, that gap is several points of margin on every item.

Is import duty charged on freight?

It depends on the country. The UK and EU charge duty on the CIF value: goods plus freight and insurance to the border. The US charges duty on the transaction value, which excludes international freight and insurance. Pick the basis above and the calculator applies it per line.

Is UK import VAT part of landed cost?

Not for a VAT-registered business. Import VAT is charged on the customs value plus duty, but you reclaim it, usually through postponed VAT accounting, so it affects cash flow rather than cost. If you are not VAT registered you cannot reclaim it, so tick the box to include it in landed cost.

How do I handle a supplier invoice in another currency?

Enter the unit costs as invoiced and set the exchange rate to how much of your currency one unit of the supplier's currency buys, for example 0.79 for US dollars into pounds. Freight, insurance and other charges are entered in your own currency.

How does landed cost affect margin?

Directly. An item that costs $10 wholesale priced at $20 has a 50% margin. If freight adds 6% to goods cost, the landed cost is $10.60 and the margin at the same $20 price is 1 - 10.60 / 20 = 47%. Three points disappeared without any price change, which is why pricing should start from landed cost.