It might seem that the most complex aspect of importing cargo is coming to terms with the intricate transportation network. In fact, for many importers, landed costings throw up the biggest hurdle.
Not everyone manages to meet the challenge that calculating this important figure involves, which is why we recommend that your let your freight forwarder take care of it. Why not do it yourself? Well, it’s just too important to get wrong, and too demanding to easily fit into your schedule. In the hands of trusted professionals, who deal with landed costings every day, you can rest easy knowing that it will be done right.What Is The Landed Cost?
In a nutshell, the landed cost of any item is its total cost when it arrives on the buyer’s doorstep. But to be fully accurate, a wide variety of individual expenses have to be included, from brokerage fees to shipping costs, and from taxes and tariffs to insurance and handling fees. Basically, it includes every type of cost involved in transporting a product from factory to retail outlet.
Calculating landed costings is a complex undertaking, but it is essential if the true cost of a product is to be ascertained, and consequently, the best possible price to be sold at. For example, imagine if you imported iPhones and the landed cost was calculated without handling fees. The fees must be paid, so they would have to be taken from your profits instead.
Why Leave It To Your Freight Forwarder?
Traditionally, an importer would get their accounts or purchasing clerk to take care of all the calculating, but there are two chief reasons why this is not always the best root to take – efficiency and accuracy.
It takes time to do properly but your clerk has other things to do too. It can take as long as an hour to calculate the figures properly, and in this time, other important tasks could be done. So, it’s not very time-efficient.
The second reason is accuracy. The complexity involved is such that it is pretty easy for important elements to be missed, especially when trying to complete the task as quickly as possible to move on to something else.
A freight forwarder, however, can calculate landed costings as part and parcel of their customs clearance service and can commit their full attention to the task. What is more, since it’s part of the service, it involves no extra cost.
Faster And More Efficient
At International Cargo Express, we use the compile system, which is the government-owned clearance software used by the Australian Customs Service. It means their operational system is connected to ours, so we can extract information very simply and quickly to calculate the landed cost for any type of merchandise.
Of course, it’s always possible to calculate things manually, but these programs have a great advantage for importers with multiple invoice lines on their commercial invoices. If there are only one or two lines on the invoice, this service could be considered overkill, but if you’ve got 15 or 20 lines, it allows us to do things much quicker – even more precisely, as we use up-to-date customs data.
We also ensure that important – but often forgotten – elements are included, like marine insurance or publication costs (brochures), so the figure is completely accurate. And, we can also provide reports with variable exchange rates. Our default rate of exchange is the one levied to us by the Australian Customs Service, but our customers often nominate a preferred exchange rate to us.
Contact Your ICE Team
Landed costings are important to get right. Mistakes can prove very costly in the long run and create no shortage of headaches.
At International Cargo Express, we’ve been taking the burden off our customer for the best part of 25 years, saving them time, stress and money. And because we are connected to the official Compile System, we can guarantee the highest degree of accuracy.
