The unit price is not the cost
The number on the supplier's invoice is the price of the goods. It is not the cost of the goods, because the goods are not where you need them. Everything that happens between the supplier's floor and your shelf is also cost, and it lands on the same units.
All figures below are invented for the example. Nothing on this page is a normal, typical or expected value for any product or any country.
The method, in one line
Add every cost of acquiring the shipment, then divide by the number of units that arrived. That is the landed cost per unit, and it — not the invoice price — is the number every margin decision has to be made against.
A worked shipment
Suppose 500 units at a unit price of $12.00: goods value 500 × 12.00 = $6,000. Freight for the whole shipment is $800. Duty at a stated hypothetical 5% of the goods value is 6,000 × 0.05 = $300. Insurance on the shipment is $60 and handling, brokerage and port fees come to $40.
6,000 + 800 + 300 + 60 + 40 = $7,200 landed, so 7,200 ÷ 500 = $14.40 a unit.
The invoice said $12.00. The shelf cost is 14.40 − 12.00 = $2.40 more, which is 2.40 ÷ 12.00 = 20% above the price you negotiated so hard.
That 5% is an illustration and nothing else. What applies to your goods depends on what they are and where they are going, it changes, and this page does not know it — look it up for your own shipment or ask someone who handles them.
The line almost everyone forgets: the currency
If the invoice is in another currency, the rate you actually got is not the rate you looked up. Say the invoice is 66,000 in the supplier's currency. At a mid-market rate of 11.00 to the dollar that is 66,000 ÷ 11.00 = $6,000, which is where the figure above came from. But the rate your bank or payment provider actually applied was 10.80: 66,000 ÷ 10.80 = $6,111.11. The spread cost 6,111.11 − 6,000 = $111.11 before a single box moved.
And it does not stop there, because the duty percentage applies to the goods value, which has just gone up: 6,111.11 × 0.05 = $305.56.
6,111.11 + 800 + 305.56 + 60 + 40 = $7,316.67, so 7,316.67 ÷ 500 = $14.63 a unit. The spread alone moved the landed cost by 14.63 − 14.40 = $0.23 on every unit.
Where the loss hides
Suppose you set the shelf price at $15.00 while thinking your cost was the invoice price. You believed you had 15.00 − 12.00 = $3.00 a unit, or 500 × 3.00 = $1,500 on the shipment.
Against the real landed cost you have 15.00 − 14.63 = $0.37 a unit, or 500 × 0.37 = $185. Now add the costs of selling it: say packaging and a payment processing charge together come to $0.60 a unit. That is 0.37 − 0.60 = −$0.23 a unit, a loss of 500 × 0.23 = $115 on a shipment you thought was carrying $1,500.
Nothing dramatic happened. No cost was unusual. The whole reversal came from pricing against the invoice instead of against the shelf.
Three things worth knowing about the arithmetic
Shipment costs are shared, not per-unit. Freight of $800 across 500 units is 800 ÷ 500 = $1.60 a unit; across 250 units the same freight is $3.20. Order size changes the landed cost of every unit, which is the real argument for and against buying in bulk.
Count what arrived, not what you paid for. If 20 of the 500 units are damaged on arrival, the whole cost is carried by 480: 7,316.67 ÷ 480 = $15.24 a unit, which is above the shelf price on its own.
Fold the spread in before you start. Convert the invoice at the rate you actually received, and put fees your calculator has no field for — a transfer charge, storage, an inspection — into the other-fees line. A cost with no home in the model is a cost that quietly becomes zero.
The Landed-Cost / COGS Calculator takes the unit price, the quantity, total freight, a duty percentage, insurance and other fees, and returns the duty amount, the total landed cost and the per-unit landed cost. It has no currency field and no view on any percentage: convert first, enter what you actually paid, and every figure it prints is arithmetic on your own numbers. It is not tax or accounting advice.