How to Calculate Landed Cost for China Sourcing

Start with six cost buckets

Separate a confirmed amount from an estimate and an unknown. Use the same currency throughout, recording the conversion rate and date. Add payment or currency-conversion charges only when they apply. Do not count taxes twice if a written quote already includes them.

A worked example you can recalculate

The following is a hypothetical teaching example, not a JTLGO shipment quote, tariff or promised saving. Suppose you purchase 100 identical units at USD 4 each.

Budgeted cost per ordered unit is USD 677 ÷ 100 = USD 6.77. The product-only price of USD 4 would understate the example by USD 2.77 per unit.

Only the purchasing-fee rule uses the JTLGO public schedule checked on 2026-10-11: 10% of product value, minimum USD 10. All other amounts are invented inputs. Actual warehouse work and materials are separately quoted; the listed free storage period is 7 days. Orders above USD 10,000 may receive a specialist-approved discount, so do not deduct one without written approval.

Cost lines and quote status

Cost lines and quote status: Products, China delivery, Purchasing, Warehouse, Freight, Destination

Cost line	Evidence required
Products	SKU, quantity and unit price
China delivery	Supplier-to-warehouse quote
Purchasing	Order grouping and fee basis
Warehouse	Work, materials and storage
Freight	Final packing and delivery scope
Destination	Verified exclusions and local charges

View full diagram

Treat uncertainty as a budget range

Keep the USD 45 destination placeholder visible until you obtain the applicable calculation. Tax treatment depends on destination, product classification, declared value and current rules; a supplier's guess is not a customs decision. Confirm DDP inclusions and exceptions in writing rather than assuming every local charge is covered.

If the hypothetical freight increases from USD 150 to USD 190, the total becomes USD 717 and the cost per ordered unit USD 7.17. That is a USD 40 change, or USD 0.40 per unit. Record it as an alternate scenario rather than silently changing the original budget.

Defective goods change the denominator. If the original USD 677 buys only 95 usable units and no credit is recovered, usable-unit cost is 677 ÷ 95 = USD 7.13, rounded to two decimals. Five unusable units are an assumption for sensitivity analysis, not a defect claim about a supplier. Buying additional stock without estimating demand adds inventory cost rather than guaranteeing savings.

Compare supplier offers fairly

Before comparing totals, match material, dimensions, packaging, quantity and inspection scope. A cheaper offer may omit accessories or use a different specification. Ask whether the unit price changes at the requested quantity, whether domestic delivery is per supplier, and when production finishes.

For small orders, minimum fees deserve attention: USD 60 of goods attracts a USD 10 purchasing fee under the dated rule, rather than USD 6. Combining purchases may spread fixed charges, but extra handling, shipping or a delayed seller can offset that benefit. Ask how orders will actually be grouped and billed.

Hypothetical sensitivity comparison

Hypothetical sensitivity comparison: Base, Freight rises to USD 190, Only 95 units usable

Scenario	Total / denominator
Base	USD 677 / 100 = USD 6.77
Freight rises to USD 190	USD 717 / 100 = USD 7.17
Only 95 units usable	USD 677 / 95 = USD 7.13

View full diagram

A quote request that removes guesswork

Send SKU links, quantities, destination/postal code, target delivery date, special cargo attributes and packaging needs. Ask for an itemized quote showing currency, validity date, measurement basis, included services and exclusions. Request invoices and retain the packing list; accurate descriptions and values support customs handling.

Use Rate & Ship to screen freight with packed dimensions and weight. Before approval, confirm the charges that can be confirmed and clearly mark any remaining estimates or unknowns. After delivery, reconcile invoices against the budget. Your next order can use those actual costs instead of repeating the same guesses.

Build a quote register, not a single total

Give every cost line an owner, date, validity and status: confirmed, estimated or unknown. “Unknown” must remain a blank budget input with an action to resolve it, not zero. Record the quoted delivery endpoint and who pays a charge if the freight provider excludes it. Separate recoverable tax from cash needed at import only after an adviser confirms recovery eligibility; do not assume it is recoverable.

Keep the denominator consistent. If the order contains a mix of products, do not divide the whole freight bill equally merely because each row has the same quantity. Choose and document an allocation basis appropriate to the charge, such as measured volume for volume-driven freight or product value for a value-based purchasing fee. Show both the order total and each SKU’s usable-unit cost.

A small-order trap

Hypothetical only: two separately billed purchasing orders of USD 60 each have USD 10 fees each under the published minimum, giving USD 20. If JTLGO confirms they can be billed as one USD 120 order, the same rule gives USD 12, a potential USD 8 fee difference before any other costs. Do not assume separate transactions will be grouped; extra domestic shipping, handling or waiting can consume that difference.

Copyable request and reconciliation

For each line please provide amount/currency, basis, quote date/expiry, status and exclusions. Specify the purchasing-order grouping, packing version and delivery endpoint. Destination charges not verified: […]. Responsible person/source and next step: […]. After delivery enter the actual invoice amount beside the budget, explain changes in measurements or scope, and distinguish seller credit from a pending claim. A claim with no recovered money is not a cost reduction.