How to compare delivered cost with factory price
A factory price is not what you pay. Add freight, duties, insurance and local handling to reach a landed cost per unit, then compare. Includes a calculator.
To compare a factory price with a delivered price, convert both to a landed cost: everything it costs to have the goods usable at your site, divided by the quantity. Use the calculator below with figures from written quotes; no number on this page is a typical rate.
What goes into landed cost
- Unit price as quoted, with its basis (ex-works, free on board, delivered).
- Freight: origin handling, main carriage, port charges.
- Duties and taxes: depend on classification and country; confirm with a customs broker or the authority.
- Insurance for transit.
- Local handling: clearance, inland haulage, unloading, storage.
- Allowances: breakage or shortage, and currency movement between quote and payment.
Use the calculator
Enter each line as a total for the order, in one currency. The tool adds them and shows a per-unit figure if you enter the quantity.
Read the trade term
A quote is only comparable if you know where the supplier's responsibility ends. A delivered-to-site price already includes some lines that an ex-works price does not. Ask the supplier to state the trade term and exactly what it covers.
Compare fairly
- Normalize each offer to the same quantity and specification.
- Calculate landed cost for each.
- Add the cost of time: if one source is slower, what does delay cost you?
- Add risk: unfamiliar routes, new suppliers, no local warranty support.
The quotation comparison guide covers non-price factors. For local versus imported choices, see local sourcing vs imported materials.
Request the right breakdown
Put it in the RFQ: ask for the unit price and each extra on its own line (writing the RFQ). Check delivered goods against the order at receiving (checklist).
Questions people ask
What is landed cost?
The total cost of getting a product to your site: unit price plus freight, duties and taxes, insurance, handling and other charges.
Which costs are commonly missed?
Port charges, customs brokerage, inland haulage, unloading and damage allowance.
Do duty rates appear here?
No. Rates depend on the product classification and country; confirm with a customs broker or the customs authority.
What is an Incoterm?
A standard trade term, published by the ICC, that defines who pays and bears risk at each stage of delivery.
Sources and further reading
Have a project outline or drawings?
Organize your scope, then contact Digital Oro through its official channel. Availability, engineering, pricing and delivery terms need project-specific confirmation.
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Digital Oro International advertises on The Company Chronicle. This guide was written by our editorial team from public sources and general professional practice; it does not describe a guarantee, quote or offer from Digital Oro International. Confirm current terms, prices and availability with the operator before you decide.