Landed Cost

Landed Cost represents the total cost of a product once it has arrived at the buyer's doorstep. It includes the original purchase price plus all transportation fees, customs duties, taxes, insurance, currency conversion, handling, and payment fees associated with the shipment.

Calculating landed cost provides a more accurate picture of true acquisition cost, especially for internationally sourced goods:

• Purchase Price + Shipping + Duties + Taxes + Insurance + Fees = Landed Cost

Comparing suppliersbased on landed cost rather than just the initial purchase price is crucial for making informed sourcing decisions. Procurement software can automate landed cost calculations by integrating data from suppliers, logistics providers, and customs brokers, providing a comprehensive view for total cost analysis.