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Work out the true per-unit cost once freight, duties and fees are in.
The invoice price is the smallest part of what an imported unit costs you. Freight, duty, clearing, insurance and handling routinely add 10–30% on top — and every margin, price list and valuation built on the invoice price alone is wrong by exactly that amount.
Your numbers
Landed cost per unit
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Use this as the cost basis for valuation and margin.
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The formula
Landed cost = (Unit cost × Qty) + Freight + Duties + Fees
Divide by quantity for the true per-unit cost basis used in COGS and margin.
What it means
Landed Cost — full definition
Read in the glossaryTotal the shipment-level costs: freight, duty, clearing agent, port charges, insurance, inland transport.
Allocate them across the shipment. Splitting by unit works for uniform goods; split by value or by weight when the shipment is mixed.
Push the resulting per-unit figure into your item cost so margin, valuation and reorder decisions all use the same basis.
Allocating shipment costs evenly per unit across a mixed container overstates the cost of cheap items and understates the expensive ones. Use value or weight instead.
Exchange-rate movement between order and clearance is a real component of landed cost. Book it at the rate you actually paid, not the rate on the PO.
Worked example
500 units at 20 each is a 10,000 invoice. Add 1,200 freight, 800 duty and 300 in fees and the landed total is 12,300 — 24.60 per unit, an uplift of 23%. Priced at 30 against the invoice cost, the item looks like a 33% margin. Against landed cost it is 18%.
Only if you cannot reclaim it. Recoverable input VAT is a cash-flow item, not a cost; irrecoverable duty and levies genuinely belong in the unit cost.
Allocate by customs value for duty-driven costs and by weight or volume for freight. Splitting everything evenly per unit is the most common error in landed-cost workings.
It should. Under most accounting standards, inventory is carried at the cost of bringing it to its present location and condition — which is landed cost, not invoice price.
This calculator works on one set of numbers. AWRA OpsHub keeps landed cost calculator results current across every item, supplier and location — automatically.
Turn cost and price into margin %, markup % and profit per unit.
Quantify the gap between the price you planned and the price you paid.
Set a price from cost plus markup, and see the margin it really delivers.