Build a landed-cost worksheet before your first export quotation
Separate product price, freight, duties, taxes and payment responsibilities to prepare an export quote with clear pricing assumptions.
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Before quoting an overseas buyer, separate the product selling price from the complete landed cost. The International Trade Administration describes landed cost as the total price at the buyer’s doorstep, including product price, insurance, freight, tariffs, taxes and other fees. Start with a worksheet rather than comparing only factory prices.
Begin with product price, insurance and freight as separate inputs. Record the amount and currency for each and, as a practical control, retain the underlying quotations with the calculation version. Mark an unavailable figure as unconfirmed. The official cost categories show why the product price alone is not the buyer’s final total.
Identify the product’s HS classification in the destination market before looking up duties and taxes. Keep the code, destination and source together in the worksheet. ITA places the importing country’s classification at the start of the calculation; a rate used for another product or country is not a reliable substitute.
Check whether the product actually qualifies for any preferential rate. ITA says to choose the best rate for which the product qualifies; trade agreement treatment is conditional. Record both the rate used and its eligibility basis. Keep an unverified preference as an unresolved scenario instead of treating the potential saving as certain.
List other taxes and fees separately, such as customs fees, VAT or local sales taxes, and establish their calculation bases. Do not hide everything inside a single tariff percentage. Keeping a source for each line makes missing information visible. An unknown fee should prompt a follow-up question rather than a zero entry.
Clarify which party pays duties and taxes. ITA notes that this is often determined by the Incoterm in the sales contract and can be discussed with a customs broker or freight forwarder. Put the agreed responsibilities and the scope of the transport quotation into the pricing assumptions to avoid omissions or duplicate charges.
Confirm the destination’s valuation and tax bases before building formulas. The official worked example adds product value, insurance and freight, but it first asks what value the foreign taxes and tariffs use. Do not copy its illustrative rates or formula into another market without checking. Link each formula to its actual inputs.
Label the result as an estimate and refresh it before the final quotation. ITA warns that duties and taxes can change and transport or brokerage providers may add charges. Prepare a clear explanation for the buyer alongside the detailed internal worksheet. Next, resolve the HS code, logistics quotation and payment responsibilities.