Most FBA sellers calculate landed cost using only the supplier invoice and freight quote — then watch margins disappear. We break it down with a free calculator and a worked example for home textiles.
This guide focuses exclusively on import landed cost — every dollar you pay between the supplier's factory in China and your goods sitting at the US port of entry, cleared through customs.
It does not cover Amazon FBA fees themselves (referral fee, fulfillment fee, monthly storage, long-term storage). Those are separate calculations on top of your landed cost and depend on the product category, size tier, and season.
Selling price − Amazon fees − Landed cost = Gross margin per unit
Most sellers know the first two. The third is where margins quietly evaporate.
FOB stands for Free On Board, but the name is misleading. It does not mean the supplier delivers to your destination — it means the supplier covers everything up to (and onto) the ship at the port of departure in China. From that point onwards, freight, insurance, customs, and US-side logistics are your responsibility.
Make sure your Alibaba or supplier quote is FOB and not EXW (Ex Works). EXW means you also pay for trucking inside China and Chinese export clearance, which adds 5–10% to the cost. If you want the supplier to handle everything to your US warehouse, ask for a DDP (Delivered Duty Paid) quote — but DDP from China often hides costs and creates customs risk, so most experienced FBA sellers stick with FOB.
Sea freight is the standard for FBA imports. Rates fluctuate but for a 20ft container from Shenzhen or Ningbo to Long Beach, expect $2.000–$4.500 in 2026, depending on the season. Less-than-container (LCL) shipments cost $80–$180 per cubic metre.
This is where most FBA calculations break. When importing from China to the US, you pay two separate duty layers:
Combined, this means roughly 31% of the FOB value goes to US duties for Chinese home textiles. The Section 301 layer is the one most sellers forget — it does not appear on the supplier invoice or the freight quote, only on the customs broker's bill.
Until 2025, shipments under $800 entered the US duty-free under the de minimis rule. This ended for Chinese goods in May 2025. If you import samples, restocks, or small test batches from China, every shipment now requires formal customs entry, broker fees, and full duty payment — regardless of value. There is no longer a duty-free threshold for China-origin goods. This makes bulk importing to US warehouses (the standard FBA model) more cost-efficient than small direct shipments.
Unlike the EU, UK, and most of the world, the US calculates customs duties on the FOB value (the supplier price at the port of departure). International freight and insurance are excluded from the dutiable base. This is good news for US importers — duties are calculated on a smaller base than they would be in Europe. The same shipment to the EU would face duties calculated on the higher CIF value (FOB + freight + insurance).
Following the November 2025 Trump–Xi trade agreement, Section 301 tariffs remain in force, but: (1) certain new tariff increases were suspended until November 2026; (2) 178 product-specific exclusions were extended to November 2026 — check if your HS code qualifies; (3) home textiles at 25% are unaffected by these changes.
There is also a temporary Section 122 surcharge of 10% on virtually all imports, in force since February 2026. A federal court ruled it unlawful in May 2026, but it continues to be collected under appeal and is set to expire on 24 July 2026 unless Congress extends it. Factor it in for shipments arriving before that date.
With several tariff types changing at once, here is a quick reference of what applies to Chinese imports right now:
| Tariff / rule | Rate | Status (June 2026) |
|---|---|---|
| Standard duty Based on HS code |
0–12% | In force |
| Section 301 China-specific, since 2018 |
7.5–25% | In force |
| Section 122 Temporary 10% global surcharge |
10% | Expires 24 Jul 2026 |
| Section 232 Steel / aluminium only |
10–25% | In force |
| Reciprocal tariffs (IEEPA) Struck down Feb 2026 |
— | Removed · refunds |
| De minimis ($800 duty-free) Ended for China May 2025 |
— | Eliminated |
For most FBA home-textile imports, the duties that actually apply are the standard duty + Section 301 (25%), plus the temporary Section 122 (10%) until it expires. The worked example below uses the stable standard duty + Section 301 baseline.
Two small fees charged by US Customs on every import:
Required for any import over $2.500. Expect $100–$250 per shipment for a standard entry. Some FBA prep companies bundle this into their service.
Goods cannot go directly from the port to Amazon warehouses. You need:
Let us calculate the landed cost for a realistic FBA scenario — a textile/home category seller importing 1.000 decorative cushion covers from a supplier in Shenzhen, destined for Amazon's Los Angeles fulfillment center.
Product details:
| Cost component | Amount (USD) | % of total |
|---|---|---|
| 1. FOB value (1.000 × $3.20) | $3.200,00 | 53,3% |
| 2. Ocean freight LCL (2.4 m³ × $120) | $288,00 | 4,8% |
| 3. Insurance (0.3% of shipment value) | $10,46 | 0,2% |
| 4. Import duty (6.3% of FOB $3.200) | $201,60 | 3,4% |
| 5. Section 301 tariff (25% of FOB $3.200) | $800,00 | 13,3% |
| 6. MPF (0.3464% of FOB value) | $32,71 | 0,5% |
| 7. HMF (0.125% of FOB value) | $4,00 | 0,1% |
| 8. Customs broker | $150,00 | 2,5% |
| 9. Prep service (1.000 × $1.20) | $1.200,00 | 20,0% |
| 10. Inbound to Amazon FC (~620 lb × $0.35) | $117,00 | 1,9% |
| Total landed cost (1.000 units) | $6.003,77 | 100% |
| Landed cost per unit | $6,00 |
The FOB price was $3,20 per unit. The landed cost is $6,00 per unit — 1,9× the supplier invoice. If you priced your product based on a 3× FOB markup (a common rule of thumb), your margin is already gone before Amazon fees enter the equation.
With landed cost calculated, you can now stack the Amazon-side costs to find your true gross margin. For the same cushion covers selling at $19,99 on Amazon US:
| Selling price | $19,99 |
| Amazon referral fee (15% for Home category) | −$3,00 |
| FBA fulfillment fee (standard size) | −$4,75 |
| Monthly storage (estimated per unit/year) | −$0,40 |
| Landed cost per unit | −$6,00 |
| Gross profit per unit | $5,84 |
| Gross margin | 29,2% |
This is a viable margin for FBA, but only because the landed cost was calculated properly. If the seller had used only FOB + freight ($3,49 per unit) to estimate landed cost, they would have projected a margin of 41,3% — and been blindsided by the actual 29,2% reality.
Landed cost is the total cost of getting a product from the supplier's factory in China to a US port and through customs, ready for inbound to Amazon. It includes the FOB price, ocean freight, insurance, US import duties (standard duty plus Section 301 tariff for Chinese goods, both calculated on FOB value), customs processing fees (MPF and HMF), customs broker fees, and prep/inbound costs to Amazon fulfillment centers. For home textiles, landed cost is typically 1.8x to 2x the FOB supplier price.
US customs duties on goods from China are calculated in two layers: (1) the standard import duty based on the product's HS code (you can look it up in the official Harmonized Tariff Schedule), and (2) the Section 301 tariff applied specifically to Chinese goods, typically 25% on top of the standard duty. Both layers are applied to the FOB value (the supplier price at the port of departure in China) — not CIF. For home textiles (HS 6304), this means roughly 31% of FOB value in total duties.
US Customs calculates import duties on the FOB value, not CIF. This means international freight and insurance are excluded from the dutiable base — only the supplier price at the port of departure in China is used. This is different from the EU, UK and most of the world, which calculate duties on CIF (Cost + Insurance + Freight). For US importers, this means duties are calculated on a smaller base than they would be in Europe — but the Section 301 tariff on Chinese goods still applies on top.
No. FOB (Free On Board) means the supplier covers everything up to and including loading the goods onto the ship at the port of departure in China. From that point onwards, ocean freight, insurance, import duties, customs fees, broker fees, and last-mile delivery are the buyer's responsibility. The only Incoterm where the supplier handles duties is DDP (Delivered Duty Paid), but DDP quotes from Chinese suppliers often hide costs and create customs risk.
Landed cost is what you pay to get a product from the supplier's factory to a US port, cleared through customs. Amazon FBA fees are what Amazon charges you to fulfill orders from their warehouses — including the referral fee (typically 15% of selling price), the FBA fulfillment fee (based on product size and weight), and monthly storage fees. To calculate true profit per unit: Selling Price − Amazon Fees − Landed Cost = Gross Margin. Most sellers calculate the first two but forget how landed cost evolves with duties and Section 301 tariffs.
Our free calculator handles all import-side costs — freight, duties, Section 301 tariffs, MPF, HMF, customs broker. Add your Amazon fees on top to see real margin in 60 seconds.
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Tariff rates and customs fees change. This article reflects 2026 rates for HS 6304 home textiles imported from China. Always verify current rates with a licensed customs broker before placing large orders.