The factory price is only the start. The number that matters is the landed cost: what each unit costs when it arrives at your warehouse.
What goes into landed cost
- Product price (and tooling spread over units)
- Sourcing service fee
- Inspection
- Freight to your country
- Insurance
- Import duty and taxes
- Customs brokerage and port fees
- Delivery to your warehouse
A simple example
2,000 units at US$5.00 = US$10,000. Service fee 8% = US$800. Inspection US$299. Sea freight and local charges US$1,400. Duty at 5% of customs value = about US$500. Brokerage and delivery US$450. Total about US$13,450 — US$6.73 per unit, 35% above the factory price.
How to lower it
- Optimize carton size to fit more units per cubic meter.
- Consolidate suppliers into one shipment.
- Check your product’s HS code and any trade programs that apply.
- Order larger quantities when cash flow allows.
Every quote we send includes a landed-cost estimate so you can decide on facts.
A worked example
1,000 insulated bottles at US$4.20 FOB Ningbo:
- Goods: US$4,200
- Sea freight (LCL, about 3 m³) and origin charges: about US$450
- Insurance: about US$25
- US customs duty (example rate 10% of customs value plus applicable additional tariffs): about US$420–1,260
- Customs broker, port and handling fees: about US$300
- Delivery to warehouse: about US$200
- Inspection: US$299; sourcing fee (10% under US$5,000): US$420
Landed cost: roughly US$6,300–7,150, or US$6.30–7.15 per bottle — 50–70% above the factory price. Tariff rates change; check the current rate for your HS code with your customs broker.
The costs people forget
- Destination port, terminal and documentation fees.
- Bank fees on international transfers (often US$25–50 per payment).
- Currency movement between quote and payment.
- Storage if goods arrive before your warehouse can receive them.
- Product testing and certification for your market.
Use landed cost to choose suppliers
A supplier with a slightly higher price but better packaging (fewer cartons, less volume), a port closer to the factory or fewer defects can deliver the lowest landed cost. Compare suppliers on landed cost per sellable unit, not factory price.
