Why your import profit disappears between the quote and the warehouse

Almost every importer we speak to prices their goods off the supplier invoice and the freight quote. Both numbers are real, and both are only part of the cost. By the time the container is on your yard, the cash you have spent is usually 25–60% higher than the invoice, and the margin you promised yourself has quietly gone.

These are the five costs that most often go missing, in the order they usually bite.

1. Tax charged on more than the goods

Import VAT or GST is rarely charged on the supplier invoice alone. Most countries tax the customs value plus duty plus certain levies. That means freight, insurance and even a trade levy can end up inside the tax base, so a 10% tax rate costs you far more than 10% of the invoice.

2. Levies that are not duty and not tax

Trade levies, inspection fees, cargo tracking notes, processing fees and harbour fees are separate charges with their own bases, minimums and maximums. A fee of "1.2% of CIF or US$190, whichever is higher" behaves very differently on a small shipment than on a big one.

3. Clearing costs that are quoted verbally

Broker fees, terminal handling, delivery orders, document processing and bank charges are usually agreed on the phone and never written into a costing. Together they are frequently the difference between a 20% margin and a 9% one.

4. Shared costs allocated badly

When one container holds three products, splitting freight evenly across them flatters the cheap, heavy items and punishes the expensive light ones. Allocating by purchase value (or weight or volume where that reflects reality) changes which product looks profitable.

5. Units you cannot actually sell

Landed cost per unit only means something if the denominator is sellable units. Breakage, samples and short-shipment all raise the real per-unit cost. Cost on sellable units, not shipped units.

What to do instead

• Write down every charge as a rule, with its own base, rate and any minimum or maximum.
• Decide explicitly what sits inside the tax base for your destination.
• Allocate shared costs on a basis you can defend.
• Compare landed cost per unit against your real selling price, minus your selling costs.
• After clearance, put the actual invoices next to your estimate and keep the difference.