What this landed cost estimate measures
The calculator starts with factory purchase price × ordered units, then adds international freight, batch insurance and handling, modeled customs duty, optional import VAT or GST, and local fulfillment on saleable units. It divides the combined economic cost by saleable units. The result includes local fulfillment, so it is broader than a customs declaration value or an inventory-cost figure.
The separate total shipment cash cost shows what the batch consumes through import: goods, freight, insurance and handling, duty, and import VAT. It excludes local fulfillment. This distinction matters when import VAT is recoverable: VAT can still require cash at the border even when it does not remain a final economic cost.
The formula and a 500-unit worked example
Product value = unit factory price × ordered units. Customs value is either product value alone or product value + freight + insurance and handling, according to the selected basis. Customs duty = customs value × duty rate. The simplified import VAT estimate = (customs value + duty) × VAT rate. Delivered unit cost divides the batch economic total, including local fulfillment for saleable units, by saleable units. Each batch charge is rounded to cents before totals are combined.
With 500 units at $8 each, $900 freight, $150 insurance and handling, and a 6% duty rate on the combined $5,050 customs value, duty is $303. At 0% import VAT and $1.25 local fulfillment per unit, shipment cash cost is $5,353 and delivered economic cost is $5,978. Divide by 500 saleable units for $11.956, displayed as $11.96 per unit. Use the unrounded unit figure when reconciling the batch total; multiplying the displayed unit figure by the unit count may differ from the exact total.
If duty is assessed on goods value alone in this example, the modeled duty falls to $240 and delivered cost to $11.83 per unit. The $0.13 difference per unit comes solely from the valuation basis, so choose that basis before comparing supplier quotes.
Choose a customs value that matches the destination
There is no universal rule that duty is calculated on the supplier invoice alone. US Customs and Border Protection says international freight and insurance are generally excluded from the US dutiable value when separately identifiable; certain packing, assists and other additions may still apply. For EU imports, customs valuation can include transport and insurance costs to the EU border. The two basis choices in this tool let you model those broad approaches, but they cannot replace your actual declaration.
The percentage itself also depends on the product's tariff classification, origin, trade measures and destination. Enter a rate from your own classification or broker rather than assuming a general country rate. If only part of the combined insurance and handling input belongs in customs value, separate that part in a more detailed worksheet; this calculator includes the whole combined amount in its freight-and-insurance basis.
Model import VAT without confusing cash with cost
Import VAT or GST is optional and defaults to 0%. The simplified tax base here is the selected customs value plus modeled customs duty. The EU's import VAT base can also include other taxes and incidental expenses up to the first place of destination when they are not already in customs value. Other jurisdictions use different rules. The displayed VAT is an estimate, not an automatically verified tax assessment.
If you can recover import VAT, turn on the recoverable option. The shipment cash total still shows the estimated VAT paid at import, while the delivered economic cost and breakdown omit it. This is useful for pricing, but recovery eligibility, timing and accounting treatment should be checked against your records. If VAT cannot be recovered, leave it included as a cost.
Use saleable units and allocate mixed shipments deliberately
Keep ordered units and saleable units separate. If 500 units are purchased but only 480 are expected to be saleable after damage or quality rejection, the product value remains 500 × factory price while the batch economic cost is divided by 480. The shipment invoice does not change, but each saleable unit carries more of it.
This one-product calculator assumes the entered units share the batch costs equally. In a mixed-SKU shipment, equal per-piece freight allocation can misprice bulky or heavy products. Allocate each shared charge by an appropriate driver, such as weight, volume, declared value or carton count, then run a separate unit-cost calculation for each SKU.
Check supplier terms and costs outside this model
A supplier quote may already include some freight, insurance or customs charges under its Incoterms and delivery arrangement. Enter each cost only once. Confirm whether your freight figure ends at the port, airport, first destination or warehouse, and whether handling includes broker charges that may or may not be dutiable. Local fulfillment here is a per-unit operating cost after import, not part of the modeled customs value.
The tool does not automatically calculate exchange-rate conversion, destination-specific tariffs, anti-dumping duty, excise, inspections, storage, returns or last-mile customer delivery unless you put a relevant amount into an input. Once your imported unit cost is sound, carry it into the Shopify and Stripe profit calculator alongside selling price, payment fees and acquisition cost.