Landed Cost and Margin Calculator for Product Brands
This free calculator turns a factory quote into your landed cost per unit, your margin and the number of units you must sell to earn the order back. It uses only the numbers you type in. It is from Los Silva, co-owner of MADE.AI, a sourcing and manufacturing partner for DTC brands.
How the numbers are worked out
- Landed cost per unit = (factory price x units + shipping and freight + import duty + other import costs) divided by units.
- Import duty = factory price x units x your duty rate. In the US, duty is usually charged on the value of the goods rather than on shipping, but rules vary by product and country. Your broker confirms it.
- Gross margin = (selling price minus landed cost) divided by selling price.
- Profit per unit = selling price, minus the share refunded on returns, minus platform and payment fees, minus ad cost per unit, minus landed cost.
- Units to earn the order back = total landed cost divided by what each unit brings in before product cost (selling price after returns, fees and ads).
What this calculator assumes
- Returned units are refunded and not resold. That is the cautious case.
- Platform and payment fees are not refunded when an order is returned.
- Packaging, warehousing and pick-and-pack are not included. Add them to "other import costs" for the order if you want them counted.
- Your inputs are your own estimates. This is not a quote, and it is not customs or tax advice.
Questions to ask a factory before you place an order
- What is the minimum order quantity, and what is the price at each quantity tier?
- What does a sample cost, and how long does it take?
- What are the production time and the shipping time?
- Who pays freight, and at what point does the risk of loss move to you (terms such as EXW, FOB or DDP)?
- Is there an inspection before the order ships, and who does it?
- What are the payment terms: how much up front, how much before shipping?
- What tariff code does the factory use for the product, and does your broker agree with it?
Frequently asked questions
What is landed cost?
Landed cost is the full cost of getting one unit of a product to your door: the factory price plus shipping, import duty and the other costs of bringing it in, divided by the units in the order.
Why is landed cost higher than the factory price?
The factory price covers making the product. Freight, duty, customs fees, inspection and samples are added on top, and they are spread across every unit in the order.
How do I find my duty rate?
Ask your customs broker or freight forwarder, or look up your product's tariff code in your country's tariff schedule. In the US that is the Harmonized Tariff Schedule. Enter the rate you are given. The calculator does not look it up.
What is a good margin?
It depends on your category and your ad costs, so this page does not give a target. Look at profit per unit after fees, returns and ads, not gross margin alone. If that number is negative, the order does not work at these inputs.
Does this calculator send my numbers anywhere?
No. The math runs in your browser. Your numbers are only saved if you use the form under the result and tick the consent box.
Keep reading
Spend Leak Check · AI Readiness Score · Who is Los Silva?
Numbers you submit are saved so Los and MADE.AI can follow up. Read the privacy note.