How to calculate landed cost for imported goods
Landed cost is the total estimated cost of getting imported goods to their destination. It usually includes product value, shipping, insurance, import duty, import VAT or tax, broker fees and other import-related costs.
- Start with product value
- Add shipping and insurance
- Add duty and import tax
- Add broker or handling fees
- Divide by units for cost per unit
Landed cost formula
Product value + shipping + insurance + other import costs
Customs value x duty rate
(Customs value + duty + broker fee) x tax rate
Customs value + duty + import VAT/tax + broker fee
This is a simplified planning formula. Final customs treatment can vary depending on product classification, origin, destination, valuation rules, trade remedies and import conditions.
Simple landed cost example
£1,000
£150
£20
£30
5%
20%
In this simplified example, the customs value starts with product value, shipping and insurance. Duty is estimated from that customs value. Import VAT is then estimated using the customs value, duty and broker fee.
The final landed cost is the total planning estimate before comparing cost per unit, selling price and margin.
How to calculate landed cost per unit
Once you have the total landed cost, divide it by the number of units imported. This helps sellers understand whether the product can still make sense after freight, duty, tax and fees.
Total landed cost / number of units
Selling price per unit - landed cost per unit
What to check before relying on a landed cost estimate
Check that the product is classified under the correct commodity code.
Import duty and tax treatment can depend on where the goods come from and where they enter.
Shipping and insurance can materially change the final cost per unit.
Handling, clearance and delivery fees can make a supplier quote less attractive.
VAT or import tax can be one of the largest parts of the final landed cost.
Use cost per unit to check whether the product still has enough margin.
Use the calculator instead of doing it manually
The Landed Cost Calculator lets you enter product value, shipping, insurance, duty, import tax, broker fees, units and selling price to estimate total landed cost, cost per unit and margin.
Open the Landed Cost CalculatorLanded cost is still an estimate
This guide and calculator are for planning and comparison. They are not customs, tax or legal advice. Final import costs can depend on classification, valuation, origin rules, trade remedies, controls, documentation and fees that may not be included in a simplified estimate.
Landed cost calculation FAQ
What is included in landed cost?
Landed cost can include product value, shipping, insurance, import duty, import VAT or tax, broker fees, handling costs and other import-related costs.
Is landed cost the same as customs value?
No. Customs value is usually one part of the calculation. Landed cost is broader because it also includes duty, import VAT or tax, fees and other costs.
How do I calculate landed cost per unit?
Divide the total landed cost by the number of units imported. This gives an estimated cost per unit before comparing it with your selling price.
Can I use this landed cost calculation for commercial decisions?
You can use it as a planning tool, but final classification, duty, VAT, tax treatment and import requirements should be verified before relying on the estimate.