Landed cost
Landed cost is the total cost of getting a product to your door: the price of the goods plus freight, insurance, duties, taxes, and all other fees on the way.
In plain words
The price on the supplier's invoice is only part of the cost. Depending on the Incoterms rule, you may also pay main freight, insurance, origin and destination charges (like THC), customs duties, other import taxes, customs broker fees, storage, and local delivery.
Calculate the landed cost before you buy, not after. It shows the real cost per unit, helps you compare suppliers in different countries, and helps you set your selling price. Import VAT is also paid at customs; whether a company can reclaim it depends on local tax rules.
Example from real shipping
An importer compares two suppliers. Supplier A in Asia offers USD 8.00 per unit; supplier B in Europe offers USD 9.00. After adding sea freight, insurance, the import duty, port charges, and trucking, A's landed cost is USD 10.10 per unit and B's is USD 9.80. Supplier B is cheaper in the end.
Related terms
- Commercial InvoiceA commercial invoice is the seller's bill to the buyer for the goods. Customs uses it to see what the goods are and how much they cost.
- HS CodeAn HS code is a number that classifies a product for customs. It decides which duty rate and which rules apply to the goods.
- DDPUnder DDP (Incoterms® 2020), the seller does almost everything: it delivers the goods to the named place in the buyer's country, clears them for import, and pays the import duties and taxes.
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Request a QuoteThis glossary is general information, not legal or customs advice. Rules, fees, and practice can differ by carrier, port, and country.