The landed cost formula
Landed cost = Product price + International freight + Insurance + Customs duty & taxes + Port & clearing charges + Local transport + Other costs
Components explained
| Component | What it covers |
|---|---|
| Product price | Ex-factory or FOB price from the supplier, including packaging. |
| International freight | Sea or air freight to the destination port or airport. |
| Insurance | Cargo insurance for the transit; commonly a small percentage of the cargo value. |
| Customs duty & taxes | Customs duty, any additional or regulatory duties, sales tax and advance income tax, as applicable to the HS code. |
| Port & clearing | Terminal handling, shipping-line charges, clearing-agent fees, examination and delivery order. |
| Local transport | Trucking from port to your warehouse. |
| Other | Bank charges, inspection, demurrage/detention if any, and currency-exchange impact. |
Worked example (illustrative numbers only)
The figures below are invented to show the method. They are not real duty rates; use your HS code and current tariff for real calculations.
| Item | Amount (PKR) |
|---|---|
| Goods (FOB) for 1,000 units | 1,000,000 |
| Freight & insurance | 120,000 |
| Assessable value | 1,120,000 |
| Duties & taxes (assumed overall 35%) | 392,000 |
| Port & clearing | 60,000 |
| Local transport | 25,000 |
| Total landed cost | 1,597,000 |
| Landed cost per unit | 1,597 |
In this example, the unit's landed cost is almost 60% higher than its factory price. That gap is why quoting and pricing on landed cost matters.
Tips for accurate estimates
- Confirm the HS code before quoting; a different code can change the duty materially.
- Keep a buffer for exchange-rate movement between order and payment.
- Ask your clearing agent for a duty estimate based on the real invoice value.
- Plan to collect containers quickly to avoid demurrage.
Get a landed-cost quotation
When you request a quote, Delta Enterprises provides a landed-cost estimate for imported goods before you commit. Learn more about our import service.
Please note: trade rules, duties, taxes and documentation requirements in Pakistan change from time to time. This guide is general information, not legal or tax advice. Always confirm current requirements with FBR / Pakistan Customs, the State Bank of Pakistan, TDAP or your licensed customs agent before you ship.
Frequently asked questions
What is included in landed cost?
The supplier price, international freight, insurance, customs duty and taxes, port and clearing charges, local transport and any other costs such as bank charges or inspection.
Why does landed cost matter?
It shows your true cost per unit so you can set profitable prices and compare suppliers and routes fairly.