Modules
Landed Costs
Allocate freight, duties, and other costs to purchased inventory.
Landed costs represent the total cost of getting goods to your location, including purchase price, shipping, customs duties, insurance, and handling fees. Navigate to Purchases > Landed Costs.
Why Landed Costs Matter
The true cost of inventory is not just the supplier's price. By allocating additional costs to inventory items, you get accurate:
- Cost of goods sold calculations
- Inventory valuation reports
- Profit margin analysis
Creating a Landed Cost Entry
- Click New Landed Cost
- Link it to a purchase order or bill
- Add cost components (freight, duties, insurance, etc.)
- Choose an allocation method
- Review the allocation and save
Allocation Methods
| Method | Description |
|---|---|
| By Value | Costs are distributed proportionally based on item value |
| By Quantity | Costs are distributed equally per unit |
| By Weight | Costs are distributed based on item weight |
Example
You import 100 units of Product A ($10 each) and 50 units of Product B ($20 each). Shipping is $300 allocated by value:
- Product A total value: $1,000 (50% of $2,000 total)
- Product B total value: $1,000 (50% of $2,000 total)
- Product A landed shipping: $150 ($1.50 per unit)
- Product B landed shipping: $150 ($3.00 per unit)
The updated unit costs become $11.50 and $23.00 respectively.