Add Landed Costs to Purchase Orders

Landed costs (or extra costs) are incurred when receiving goods from your suppliers and are generally attributed to costs such as shipping, handling and duty fees, etc. And it will be distributed among the line items in the procurement.

Adding landed costs to purchase orders:

To add landed costs when receiving goods on a purchase order:

  1. Select Add Landed Costs, located towards the bottom left of the Purchase Order.
  2. Click on the Add Landed Costs below the items in the purchase order.
  3. Add the Landed cost name, the costs incurred, as well as the tax rate if applicable

 

You may add landed costs (extra costs) at any point during the purchase order workflow until the order has been partially or fully received.

Applying landed costs (extra costs):

You may apply a specific or all landed costs (extra costs) to a shipment by selecting the landed cost(s) line item(s) and clicking on receive (or receive all).

Congratulations, your products’ landed costs have now been factored in! Landed costs (extra costs) are distributed by a weighted value.

Note
To calculate Landed Cost we:
  • Calculate the total landed cost (add all separate landed costs in PO)
  • Calculate the total line items cost = sum of (qty*cost) for each line item
For each line item:
  • Calculate the dollar value ratio = Line Item Cost / Total Line Items Cost
  • Calculate the total landed cost for line item = Dollar Value Ratio * Total Landed Cost 
  • Calculate the landed cost per quantity for a line item = total landed cost for line item / qty
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