How to Calculate Total Landed Cost When Importing from China

Total landed cost is the only number that matters when comparing Chinese suppliers. It includes: factory price, inland freight to port, export customs fees, ocean/air freight, insurance, import duties, VAT, customs brokerage, and inland freight from destination port. A $10 product FOB can easily become $14-16 landed. Most first-time importers forget at least three cost components and end up with negative margins.

Quality control should not be a single inspection at the end. Build a multi-point QC plan: (1) raw material inspection before production starts, (2) first article inspection when the first unit comes off the line, (3) in-process inspection at 30% and 60% completion, (4) pre-shipment inspection when 80% is packed, (5) container loading supervision. Each step costs a fraction of catching defects at the destination.

The sourcing cycle from initial contact to first shipment typically takes 3-6 months for new products. Month 1: supplier research and initial contact. Month 2: sample development and evaluation. Month 3: negotiation and order placement. Month 4: production (varies by product). Month 5: inspection and shipping. Month 6: delivery and evaluation. Plan your inventory accordingly and don't expect to compress this timeline without cutting corners.