Landed Cost Calculator

Spread freight and duties across every line of an invoice, not just one product. Get a penny-exact landed unit cost for each item, then price to your target margin.

Invoice Lines

Description	Qty	Unit cost ($)

Freight / shipping total ($)

Other charges: duties, fees ($)

Allocation method

Target margin % (optional)

Sets a suggested retail from landed cost. Must be below 100.

Total Landed Cost

$357.00

$314.50 goods + $42.50 freight and charges

Effective Freight % of Goods

13.5%

Every dollar of product on this invoice carries 13.5% of inbound cost on top.

Landed Cost Per Line

Line	Qty	Unit cost	Freight share	Landed unit	Retail @ 50%
Ceramic mug set	24	$6.50	$21.08	$7.38	$14.76
Scented candle	12	$8.00	$12.97	$9.08	$18.16
Greeting cards	50	$1.25	$8.45	$1.42	$2.84

Freight shares are allocated with largest-remainder rounding in cents, so they sum to exactly $42.50.

OrderSync runs this math on every vendor invoice automatically

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The Landed Cost Formula

Landed cost = product cost + allocated freight + duties and fees, calculated per unit, not per order. 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 level, you do not actually know what any single product cost you, and every margin number built on the invoice cost alone is overstated.

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 and weight, like case-packed beverages 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 that data. If your invoice lists weights, use them. If not, by value is the standard fallback and the one most accounting teams expect.

Penny-Exact Allocation

Take 3 lines splitting $100 of freight three ways: a naive percentage calculation gives each line $33.33 and the invoice is a penny short. Across a 40-line invoice, rounding each share independently can drift several cents in either direction. That is harmless on a napkin and a real problem the moment the numbers post somewhere: a product catalog, a POS, or a GL account that must tie back to the freight charge on the invoice. This calculator allocates in whole cents and distributes the leftover pennies to the lines with the largest remainders, so the shares always sum to exactly the charge you entered.

From Landed Cost to Shelf Price

Landed cost is the number you should price from, because it is what the unit actually cost to get onto your shelf. Set a target margin above and the calculator solves retail = landed / (1 - margin%), the correct direction of the formula. To work the pricing side in more depth, use the retail price calculator for wholesale-to-retail conversions and the margin calculator to check what a given price actually earns.

From Vendor Invoice to Priced Catalog

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 and runs this math automatically, so the landed cost and suggested retail 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.

FAQ

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, duties, and fees. It is always higher than the invoice unit price, and it is the number you should use for pricing and margin decisions.

Pick a basis, usually each line's share of the invoice value or its share of total units, then multiply the freight total by each line's share. Divide the line's freight 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 sum to exactly the freight charge.

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.

Duties, tariffs, brokerage, and handling fees are all part of landed cost. Enter them in the other charges field and they get allocated across lines with the freight. For imported goods, duty often depends on the product category, so if lines carry very different duty rates you may want to run high-duty lines separately.

Directly, and by more than most people expect. Say an item costs $10 wholesale and you price it at $20 for a 50% margin. If freight adds 6% to goods cost, the landed cost is $10.60 and the margin at that same $20 price is 1 - 10.60 / 20 = 47%. Three points of margin disappeared without any price change, which is why pricing should start from landed cost.