Right, say you're ordering goods from China.
You've got yourself a chaotic, but beautiful excel book that converts currencies, works out profit margins, mark ups etc etc based on the cost of the products.
You then get the quote through and you need to take in account for the delivery costs.
How would you do it?
I've always done it by totting up the number of items and dividing it by the delivery costs. This then gives me a per item cost which I add into the total import value for each item (Cost + Import Duty + VAT)
But I can't help feeling this is wrong especially when I have lots of low value items that cost say $0.4 each, hence the post :)
The import fees into the US from China are surprisingly low, and we don't have a VAT to calculate, so my experience is quite different., but I always just figure out what it costs and add a small amount to the selling price as you described. Maybe do something like: (item*cost modifier) + (item * profit multiple)
So if the item cost $100, the import cost was say 9% and you charge 2 times the wholesale cost then you would calculate the retail price like this:
($100 * 0.09) + ($100 * 2) = $209.00
Providing it is covered I don't think it Matters.
Unless it is a high % of the total cost, your method looks fine.
Do you always get deliveries of 10kg, or £200 or can you get 1 off deliveries where it might cost more?
Is there a tax to pay?
Cheers guys,
My orders are small in comparison to others, but I'm trying to build the business so I can get it to a level where I can by pass the agents and deal direct with the manufactures.
I have someone to turn to when this happens, their business is all about importing and setting up supply chains for large corporate businesses - landed on my feet there.
But until such a time, I have to swim with the minos and carefully spend and try not to tap into my capital too much.
Just a PITA when the delivery works out to be about 15% of the total order.