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Product landed cost
Product landed cost
Gigi Nguyen avatar
Written by Gigi Nguyen
Updated over a week ago

Landed cost of an item = Purchase price + Additional charges (AC) of that item

We will have 2 kinds of AC:
1. AC of a document (SO, PO,..): the amount that is not applied to a specific product
2. AC of a product (product, RM, service): the amount that is applied to a specific item, which then affects to reports and some numbers.

You add a shipping or additional cost (eg: $100) to a purchase order of many items with different prices (eg: 2 products A at $5 and 1 product B at $10). The system will automatically distribute your shipping/additional cost proportionally to the cost of each of your product in your purchase order.

Your total cost of your purchase order in the above case is (2 X $5) + (1 X $10) = $20. Hence, with a $100 shipping fee, each product A will get a landed cost of (5/20 X $100 = $25) added to it. (Each product A landed cost – $5 + $25 = $30) (1 product B landed cost – $10 + $50 = $60).

You can choose to apply Additional Charge to all products in the Purchase Order or apply to selected products only.

With these landed figures displayed strategically for you while you are building your price list module, it allows you to quickly determine markups and ideal price of your product to sell to different customers

Landed cost price appears on Purchase Order, Sales Order, Product detail page, Pricelist edit mode, Reports (sales and inventory).

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