Beyond the Factory Price

When a Chinese supplier quotes you $3.50 per unit, that's not what the product actually costs you. The real cost — your landed cost — includes freight, duties, taxes, handling fees, and a dozen smaller charges that add up fast.

Understanding the full cost structure is the difference between a profitable import and an expensive lesson.

The Full Cost Stack

1. Product Cost (FOB Price)

Most Chinese suppliers quote FOB (Free On Board) Shenzhen, Ningbo, or Shanghai. This means the price includes the product, factory packaging, and delivery to the port. It does not include shipping to your country.

Typical ranges by product type:

• Consumer electronics: $2–50 per unit
• Textiles and clothing: $1–15 per unit
• Home goods: $0.50–20 per unit
• Health and beauty: $0.30–8 per unit

2. International Freight

This is usually the second-largest cost after the product itself.

Sea freight is almost always the best option for established products. Use LandedCost.io's shipping calculator to compare modes for your specific product dimensions.

3. Customs Duties

Duty rates depend on your product's HS code classification. Rates vary significantly:

• 0% — many raw materials and components
• 3–8% — most consumer electronics
• 8–12% — textiles, clothing, footwear
• 15–25% — some agricultural products and protected industries

Calculate the duty as: FOB price × duty rate

4. Import VAT / GST / Sales Tax

Most countries charge a consumption tax on imports:

• UK: 20% VAT on (product cost + duty + freight)
• EU: 19–27% VAT depending on the member state
• US: No federal import tax (state sales tax may apply later)
• Australia: 10% GST

If you're VAT-registered, import VAT is typically reclaimable — but it's still a cash flow cost you need to fund upfront.

5. Customs Clearance and Brokerage

A customs broker handles your import paperwork. Typical fees:

• Broker fee: $50–150 per shipment
• Port handling: $100–300 per shipment
• Examination fees (if selected): $200–500

Spread across a full container of 5,000 units, these add just a few pence per unit. But for small shipments, they can be significant.

6. Inland Transport

Getting goods from the port to your warehouse:

• UK: £150–400 depending on distance
• US: $200–800 depending on the coast and destination
• Haulage from port to FBA: Often included in a freight forwarder's quote

7. Often-Overlooked Costs

These smaller charges catch many importers off guard:

• Insurance: 0.5–1.5% of shipment value
• Cargo inspection fees (pre-shipment): $200–400
• Labelling and compliance: $0.10–0.50 per unit
• Product testing and certification: $500–3,000 (one-off)
• Storage if delayed: $10–30 per day per pallet

Worked Example

Let's walk through a real scenario: importing 2,000 Bluetooth speakers from Shenzhen to a UK warehouse.

The supplier's price was $3.50, but the true landed cost is $5.71 per unit — a 63% markup before you've even listed the product. Track all these costs automatically with LandedCost.io's cost engine.

How to Reduce Your China Import Costs

1. Negotiate MOQ and price breaks — larger orders mean lower per-unit costs
2. Consolidate shipments — ship less frequently in larger quantities
3. Optimise packaging — smaller cartons reduce volumetric freight charges
4. Use the right Incoterm — FOB gives you control over freight costs
5. Pre-shipment inspections — catching defects before shipping saves return costs
6. Choose the right freight mode — don't air-ship low-margin products

Use the free import calculator to model different scenarios before committing to an order.