How to Calculate the Total Cost of Importing from China (Landed Cost Guide)

Start with the supplier price, not the final price

The supplier quote is only the first number. Ask for FOB or EXW. Example: a machine at $10,000 FOB Shenzhen. If the supplier gives EXW, add pickup, export documents and port handling. If the quote is CIF Lagos, check the port and what is excluded. Always ask for quote validity, payment terms, lead time, carton dimensions and gross weight. Ask for product photos and an HS code suggestion.

Build a landed-cost sheet

Landed cost = goods + freight + insurance + duty/tax + clearing + inland transport + finance/admin. Use one line per cost. Do not estimate from memory. Use the supplier invoice, freight quote, clearing agent quote and bank charges. If a number is missing, mark it and chase it.

• Goods: FOB price x quantity, plus samples, tooling, packaging and labels.
• Freight: sea LCL/FCL or air. For LCL, ask for the rate per CBM and the minimum charge. For air, compare actual weight with volumetric weight (length x width x height in cm / 6000).
• Insurance: often a small percentage of CIF value. Ask the freight forwarder.
• Duty and taxes: check the HS code with a customs broker. Duty is usually on CIF, not FOB. VAT, GST or levies may apply. Get the rate in writing.
• Port or airport charges: terminal, handling, documentation, scanner and storage.
• Clearing: agent fee, transport, permits and inspections. In Nigeria, check SONCAP or other product certificates. In Sierra Leone, Niger and Chad, confirm local rules and the transit route.
• Inland transport: truck from port to warehouse, border fees if landlocked, escorts if required.
• Money: bank transfer fees, FX spread, payment platform fees and interest if you borrow.
• Admin: staff time, travel, phone and storage before sale.

Check the freight quote like a trader

Freight quotes change. Ask: is it all-in? What is excluded? For LCL, is the minimum 1 CBM? What about destination THC? For FCL, how many free days before demurrage? For air, what is chargeable weight? Ask the forwarder to show the chargeable weight calculation. If the supplier gives carton size in cm, calculate CBM: length x width x height / 1,000,000. Example: 60x40x40 cm = 0.096 CBM per carton. 100 cartons = 9.6 CBM. That is a real cost, not a small detail.

Duties and taxes: get the HS code right

The HS code drives duty. Ask the supplier for the code, then confirm with a local customs broker. A wrong code means wrong duty, delays and penalties. Duty is usually calculated on CIF value: FOB + freight + insurance. Some countries add levies, VAT, GST or other charges. Get a written estimate from your clearing agent. Do not accept a round number without the breakdown. If the agent cannot explain the rate, find another agent.

Add the costs buyers forget

• Demurrage and storage
• Supplier short shipment
• Quality rejection
• Repacking
• Local standards testing
• Label translation
• Currency movement
• Financing
• Sales returns

On a $10,000 order, a 5% FX move is $500. One week of demurrage can cost more than your profit. Keep a buffer. For a first shipment, add 10-15% contingency. Not a fake statistic, just a working rule.

Compare quotes on the same basis

Never compare a Chinese FOB quote with a local wholesale price. Compare landed cost per unit. Formula: landed cost / good units. Good units = quantity minus damaged or rejected units. If the supplier MOQ is 500 and you sell 100 per month, your cash is tied up for 5 months. That is a cost. Ask GlobemX for MOQ before you calculate.

A simple example

Say goods are $10,000 FOB. Freight and insurance $1,500. CIF = $11,500. Duty 20% = $2,300. VAT 7.5% on CIF+duty = $1,035. Port and clearing $900. Inland $400. Bank and FX $250. Admin $300. Total = $16,685. Cost per unit if 1,000 good units = $16.69. Now compare with your selling price and margin. If you only looked at $10,000, you missed $6,685. That is the real number.

Common pitfalls

• Using FOB as landed cost
• Ignoring volumetric weight
• Wrong HS code
• Clearing quote without duty
• No free days
• Supplier packs loose
• No QC before loading
• Paying full balance before inspection
• Forgetting FX
• No contingency

Fix these before you pay.

Use GlobemX to check the numbers

You can browse factory-direct products on GlobemX, see local-currency prices and clear MOQ, then a local agent confirms stock and freight before you pay. That helps you build the landed-cost sheet with fewer unknowns. Order on GlobemX when your numbers work.