Landed Cost Explained: What Really Goes Into Importing from China

Landed cost is the total cost to get one unit into your possession, ready to sell or use. It starts at the factory price (often quoted FOB — free on board at the Chinese port) and adds every charge incurred after that. Ignoring any layer quietly destroys your margin.

• Product cost — the factory price per unit.
• Freight — ocean, air, or express from China to the US port or your door. Usually the second-largest line after the product itself.
• Insurance — cargo insurance for the shipment’s value in transit.
• Base duty — the HTS MFN “General” rate on the customs value.
• Additional tariffs — Section 301, IEEPA/reciprocal, Section 232, applied per your HTS code.
• Harbor & handling fees — port handling, customs brokerage, and the MPF/HMF government fees.
• Last-mile — drayage, domestic freight to your warehouse, and any storage.

Most of these costs are quoted per shipment, not per unit. To know your true unit cost you must spread the shipment-level charges (freight, insurance, brokerage) across the number of units you actually receive. The same product can be profitable at 5,000 units and unprofitable at 500, purely because fixed shipment costs are spread differently.

Suppliers quote FOB because it excludes international freight and all US-side charges. If you compare that number to your domestic selling price, you are comparing two different things. Always convert to landed cost per unit before judging whether a product works.

Add product cost, freight, and insurance to get the shipped value; apply duty and tariffs to the appropriate base; add fees; then divide the total by units received. Our China → US Import Cost Calculator does this end to end and shows the full breakdown so you can see which layer is eating your margin.

Treat the tariff layers as estimates and confirm current rates before you buy — see our guide to how US import duties work.