Import & customs
How to calculate the landed cost of clothing imports
Landed cost is the total cost of getting a garment to your warehouse: the product price plus freight, insurance, customs duty, import VAT or other taxes, customs brokerage and inland delivery. Add them up for the shipment, then divide by the number of units to get a landed cost per piece you can price against.
Key takeaways
- Landed cost = product cost + freight + insurance + duty + import taxes + brokerage + inland delivery.
- Incoterms decide which of these costs are already in your supplier's price.
- Duty depends on the tariff classification, the origin and the customs value rules of the importing country.
- Per-unit cost is the shipment total divided by the number of garments.
- Confirm duty and tax rates with your customs broker or the official tariff, since they change.
Reference information, not legal advice. Regulations change; always confirm current requirements with the official source linked below or a compliance professional before shipping.
The short answer
Landed cost tells you what each garment really costs once it is in your warehouse. The factory price is only the start. Freight, duty and fees can change your margin a lot, so work out landed cost before you set a retail or contract price.
This guide explains the components and the method. It does not give tariff or tax rates. Rates depend on the product, origin, destination and date, so confirm them with a licensed customs broker or the official tariff.
The landed cost formula
Landed cost = product cost + freight + insurance + customs duty + import taxes + brokerage and fees + inland delivery
Landed cost per unit = total landed cost ÷ number of units
Each component
| Component | What it covers | Who usually provides the figure |
|---|---|---|
| Product cost | Garments, decoration, labels, packing, as quoted | Supplier quote |
| Freight | Sea or air transport, plus origin and destination charges | Freight forwarder |
| Insurance | Cargo insurance for loss or damage in transit | Forwarder or insurer |
| Customs duty | Tariff on the customs value, by HS code and origin | Official tariff / customs broker |
| Import taxes | Import VAT, GST or similar, where applicable | Official guidance / accountant |
| Brokerage and fees | Customs entry, handling and processing fees | Customs broker |
| Inland delivery | Port or airport to your warehouse | Haulier or forwarder |
Product cost and Incoterms
Your supplier quotes on an Incoterm. FOB means the goods are loaded at the origin port and you pay the main freight from there, and other terms shift more cost to the seller. Read Incoterms 2020 for apparel before comparing quotes, because an FOB price and a DDP price can’t be compared directly.
Freight
Freight depends on volume, weight, mode and route. For apparel on sea freight, carton volume usually drives the cost. Sea vs air freight for apparel compares the modes.
Customs duty
Duty is calculated on the customs value, at the rate for the garment’s HS code and origin. For knit apparel, classification depends on construction (knitted or woven), garment type, fibre content and gender or age category. Each country also has its own rules on which costs count towards customs value. Our US and EU import customs basics guide covers the essentials.
Import taxes
Many countries charge import VAT, GST or another tax at the border, often on a value that includes duty and freight. Whether you can reclaim it depends on your registration.
Brokerage, fees and inland delivery
Customs brokers charge for preparing entries, and ports and carriers add handling fees. Then budget for delivery from the port or airport to your door.
Worked example (illustrative only)
These are made-up round numbers to show the method. They are not Jehotex prices, freight quotes or real duty or tax rates.
| Line | Illustrative amount |
|---|---|
| Product cost: 1,000 hoodies × 10.00 | 10,000 |
| Freight (sea, to destination port) | 800 |
| Insurance | 50 |
| Customs duty (example rate X% on customs value) | 1,200 |
| Import tax (example, if not reclaimable) | 0 |
| Brokerage and fees | 250 |
| Inland delivery | 200 |
| Total landed cost | 12,500 |
| Landed cost per hoodie | 12.50 |
Here the landed cost comes out 25% above the product price, which is why pricing off the factory price alone is risky.
Ways to keep landed cost down
Fill cartons and containers efficiently. Accurate carton specs and ratio packing cut wasted volume; see export packing and cartons. Get classification right, since accurate fibre content and construction details support the correct HS code. Plan timing so you rarely need air freight, which is fast but costs more than sea. Prepare documents properly, because correct invoices, packing lists and origin documents avoid delays and storage charges (see export documents and certificate of origin). And convert every quote to the same Incoterm before you compare.
Final thoughts
Landed cost is the real cost of your garments: product, freight, insurance, duty, taxes, fees and delivery, divided by units. Build a simple spreadsheet with those lines, get freight from your forwarder and rates from your broker, and update it for each order. Ask us for a quote with your quantities and Incoterm, and we will give you carton and packing details to support the calculation.