What your e-commerce business needs to know… Landed cost is the total cost of getting your product to a customer. And that means more than just shipping. It also includes the cost of manufacturing the product, duties and taxes, and storage fees – to name just a few! Calculate your landed cost here for a simple and quick estimation of your business’ landed cost
WHY IS IT IMPORTANT TO KNOW LANDED COST?
You can’t run a business without knowing your costs – otherwise, you risk running at a loss! Calculating your total landed cost will allow you to:
- Price your products correctly
- See where you can make savings, such as switching suppliers
- Give your customers a clear breakdown of costs at checkout – which helps to build trust between them and your brand
HOW DO I CALCULATE MY LANDED COST?
PRODUCT COST
This includes the cost of manufacturing and sourcing the raw materials of the product.
+ TRANSPORTATION FEES
This includes the cost of shipping the product to your customer’s door. Handling fees, brokerage fees, freight cost and transportation costs all make your shipping expenses.
+ CUSTOMS DUTIES
When you’re shipping goods internationally, each country has customs duties and taxes associated with importing and exporting goods.
+ INSURANCE
Insuring your product protects you from lost, stolen, or damaged goods. However, its cost depends on the category and value of the shipped goods.
+ OVERHEAD COST
Overhead includes operating expenses such as employee salaries, payment processing fees, exchange rates and any other costs associated with daily business operations.
+ STORAGE FEES
This includes the storage of your products in your warehouse before shipping, and their storage whilst in custom.
+ PAYMENT PROCESSING
When shipping products, you may incur fees from the logistics provider for processing credit and debit card transactions.
= LANDED COST
OTHER THINGS TO REMEMBER WHEN YOU WANT TO CALCULATE YOUR LANDED COSTS
Dealing with overseas customers/suppliers? Remember to use the right currency for your calculations otherwise you could be out of pocket!
Optimize your supply chain processes. There are always savings to be made.
NEXT STEPS: SPEAK TO DHL
As international logistics specialists and e-commerce experts, we can help you optimize your supply chain and grow your business. Contact us today.
