ATV Landed Cost Model: Import Cost per Sellable Unit
Author: everjoymoto
Last updated: September 28, 2026
Evidence scope: This article does not quote current tariff rates, taxes, freight or margin. Classification, value, origin, duty and fees require current transaction-level review by qualified customs, tax and finance professionals.
Quick Answer
Calculate ATV landed cost per sellable unit, not supplier price per shipped unit. Include product and option cost, export packaging, inspection, international freight, insurance, customs duty and fees, port/broker charges, inland delivery, receiving, PDI, initial parts, expected damage and warranty preparation, financing and other launch costs. Keep every input tied to a source, date, currency, trade term and product revision, then test volume and downside scenarios.
Where This Article Fits
Use BL-090 to decide how much order risk to release and BL-096 for the physical shipment record. Use BL-099 as the financial cost build supporting price, margin and reorder decisions.
1. Freeze the Costing Scope
| Field | Record |
|---|---|
| Supplier/model/revision | |
| Quantity and SKU mix | |
| Trade term, named place and edition | |
| Destination/port/warehouse | |
| Shipment mode/container | |
| Quote currency and exchange-rate basis | |
| Costing date and validity | |
| Importer and tax treatment | |
| Expected sellable units |
Do not compare models or suppliers using different trade terms, option content or denominator assumptions.
2. Separate Cost Stages
| Stage | Typical inputs to verify |
|---|---|
| Ex-factory/product | Base unit, options, branding, tooling, documentation |
| Export preparation | Crate, inland origin transport, inspection, export handling |
| International transport | Freight, surcharges, insurance, dangerous-goods cost |
| Import/port | Duty, applicable fees, broker, exam, storage/demurrage risk |
| Destination delivery | Drayage/inland freight, unloading, warehouse receiving |
| Ready-for-sale | Assembly/PDI, correction, manuals/labels, initial parts |
| Support/carrying | Warranty reserve, financing, inventory, damage/non-sellable units |
Avoid mixing recoverable taxes, capitalized inventory cost and operating expenses without an accounting policy.
3. Build the Input Table
| Cost item | Amount | Currency/unit | Source/date | Fixed or variable | Confidence/action |
|---|---|---|---|---|---|
| Product and approved options | |||||
| Branding/tooling/engineering | |||||
| Export packaging | |||||
| Inspection/testing | |||||
| Origin handling/inland freight | |||||
| International freight/surcharges | |||||
| Cargo insurance | |||||
| Duty and applicable import fees | |||||
| Broker/exam/port charges | |||||
| Storage/demurrage assumption | |||||
| Destination delivery/unloading | |||||
| Assembly/PDI/rework | |||||
| Initial spare parts | |||||
| Warranty/launch support | |||||
| Financing/carrying cost |
Unknown is not zero. Keep a placeholder, owner and due date.
4. Verify Classification, Value and Origin
Record the qualified basis for:
- Tariff classification
- Product description and configuration
- Customs value, assists, tooling or other additions
- Country of origin and marking
- Applicable tariff programs or additional duties
- Entry type and relevant fee treatment
Do not copy a duty rate from an unrelated ATV, marketplace listing or old shipment. CBP expects importers to exercise reasonable care, and the HTS should be reviewed for the current transaction date.
5. Allocate Fixed and Shared Costs
Choose a rational allocation driver:
| Shared cost | Possible driver | Reason selected |
|---|---|---|
| Ocean/air freight | Package volume, mass or quoted lane basis | |
| Inspection | Units, models or inspection hours | |
| Broker/entry | Entry lines or shipment | |
| Tooling/engineering | Planned units or project policy | |
| Warehouse/unloading | Packages, mass or labor time |
One equal-per-unit allocation can distort a mixed shipment when package sizes and handling differ materially.
6. Use Sellable Units as the Denominator
Planning formula:
Landed cost per sellable unit = total applicable shipment and ready-for-sale cost ÷ expected sellable units
Expected sellable units should reflect documented assumptions for:
- Transit damage
- Missing/incorrect components
- Inspection failure and rework
- Demo/sample/non-retail allocation
- Units held for compliance or parts
Do not automatically treat every shipped unit as immediately sellable. Show the damaged/held-unit assumption separately.
7. Model Cash Timing
| Cash event | Date/milestone | Amount/currency | Financing effect |
|---|---|---|---|
| Deposit | |||
| Production/progress payment | |||
| Balance before/after shipment | |||
| Freight/insurance | |||
| Duty/fees | |||
| Delivery/PDI/parts | |||
| Expected retail receipts |
The same landed cost can create different cash and financing risk depending on payment and inventory timing.
8. Add Scenario and Sensitivity Cases
At minimum, test:
- Exchange-rate movement
- Freight and surcharge change
- Classification/duty uncertainty
- Port exam or storage delay
- Lower container utilization
- Damage/rework and fewer sellable units
- Slower sell-through and longer financing period
- Higher initial parts or warranty burden
Use one base case and clearly labeled downside cases. Do not present a best-case quote as the forecast.
9. Connect Cost to Dealer Economics
| Output | Calculation basis |
|---|---|
| Ready-for-sale unit cost | Landed cost plus preparation allocated per sellable unit |
| Gross profit | Net selling price less consistent unit cost |
| Gross margin | Gross profit / net selling price |
| Contribution after support | Gross profit less defined selling/support costs |
| Cash conversion | Payment timing to customer receipt |
| Break-even units | Fixed launch cost / contribution per unit, when assumptions are valid |
Do not exclude discounting, sales commissions, card fees, local delivery or warranty expense if they belong in the business decision.
10. Reconcile Estimate to Actual
| Input | Estimate | Actual | Variance | Cause/action |
|---|---|---|---|---|
| Product/options | ||||
| Freight/surcharges | ||||
| Duty/fees | ||||
| Port/broker | ||||
| Inland/receiving | ||||
| Damage/rework | ||||
| PDI/parts/support | ||||
| Sellable units |
Update future quotations and reorder decisions from the variance, not memory.
11. Review Model Integrity
Before using the result, check:
- All currencies converted on a stated basis
- No cost is omitted or double-counted
- Fixed costs are allocated consistently
- Duty/value/origin assumptions are current
- Sellable-unit denominator is supportable
- Formula totals reconcile to source quotations
- Base/downside scenarios use the same definitions
- Margin uses net selling price and matching cost basis
EverJoy Project Boundary
EverJoy can provide current product, package and quotation inputs available for a project. Freight, duty, taxes, fees, exchange rates, local costs, damage and support assumptions remain buyer- and shipment-specific and require independent confirmation.
FAQ
Is FOB price the landed cost?
No. It is one trade-term price input. The buyer must add the applicable transport, import, destination and ready-for-sale costs.
Should landed cost be divided by units shipped?
Use expected sellable units when some units are demos, held, damaged or require rework, and show the assumption.
Can a customs broker give the final duty rate?
Use qualified advice, but retain the classification, value, origin and date basis. Importer responsibility is not eliminated by outsourcing entry work.
Why include warranty and initial spare parts?
Because the dealer’s launch and support decision can be understated if required parts and expected support cost are excluded.
Official Reference Points
- U.S. Customs and Border Protection: Importing into the United States — Source: U.S. Customs and Border Protection (CBP)
- U.S. International Trade Commission: Harmonized Tariff Schedule — Source: U.S. International Trade Commission (USITC)
Bottom Line
Model the cost from product release to sellable inventory, with dated sources, consistent allocations and realistic sellable units. Reconcile estimates to actuals after every shipment and use downside cases before committing volume.
Confirm current classification, value, duty, tax, freight and accounting treatment for each transaction.