The question we’re asked most isn’t “how much does the product cost?” but “why did it cost me so much more than I thought?” The answer is almost always the same: the margin was calculated on the factory price and the landed cost was forgotten —that is, the total cost of the product delivered to your warehouse.
The 7 costs that slip through
- International freight. Sea, air, or rail. Rates fluctuate a lot, so a quote from three months ago may not hold today.
- Import duty. Depends on your product’s TARIC code. A classification error can mean overpaying for years.
- Import VAT. Settled at customs on the taxable base (value + freight + duty), not just on the product price.
- Customs clearance. The agent’s fees and the charges tied to releasing the goods.
- Plastic tax and packaging responsibility. In Spain, the tax on non-reusable plastic packaging and the WEEE or EPR obligations affect many categories and are often discovered too late.
- Cargo insurance. A small percentage of the value that prevents a huge problem if something goes wrong in transit.
- Last mile and storage. From the port to your warehouse, plus possible demurrage costs if the paperwork isn’t perfect.
The practical rule
A product leaving the factory at €1.00 can end up costing you €1.40-1.80 delivered to your warehouse, depending on category and origin. If you set your selling price on that €1.00, the margin you thought you had doesn’t exist.
That’s why it pays to calculate the landed cost before closing the order, line by line. That’s exactly why we built our landed cost calculator: you enter your figures and see the real cost broken down, including the plastic tax, WEEE, and import VAT.
Where the money is really made
Landed cost doesn’t just prevent nasty surprises: it’s where the margin is. Optimizing the Incoterm, consolidating cargo, classifying the duty correctly, or negotiating freight can move your final cost by several percentage points. That’s where a partner with a presence at origin adds more than on the factory price itself.
Want us to review your cost structure? Book a 30-minute consultation.