If you are planning your first order from a Chinese manufacturer, the unit price on the quote is only part of the story. By the time your goods arrive at your door in the UK, you will also have paid for samples, shipping, customs duty, import VAT and a few smaller fees along the way. Together, these make up your landed cost, and it is the number that really decides whether a product is profitable.
This guide breaks down every cost involved in importing from China to the UK, shows a worked example, and explains how to keep the total under control.
The quick answer
For most small and medium orders, expect your landed cost to be noticeably higher than the factory price. Shipping, duty and fees commonly add a significant percentage on top, depending on how heavy or bulky the goods are, how quickly you need them and which duty rate applies. Import VAT is added on top of that, although VAT-registered businesses can usually reclaim it.
The only way to get a reliable figure is to cost your specific product, which is why it pays to build a landed-cost estimate before you place an order.
The costs that make up your landed cost
1. Product cost
This is the price per unit from the factory, multiplied by your order quantity. It is affected by materials, size, level of customisation, packaging and, above all, quantity: unit prices usually drop as order quantities rise. Check exactly what the price includes. A quote may be EXW (collected from the factory), FOB (delivered to the port in China) or DDP (delivered to your door with duty paid), and each one leaves different costs for you to cover.
2. Samples and set-up costs
Most custom products need samples before bulk production, and some need one-off set-up costs such as moulds, printing plates or embroidery files. Sample fees are often modest, but express-shipping samples to the UK can cost more than the samples themselves. Some factories will credit the sample fee against your bulk order.
3. Packaging and labelling
Retail boxes, branded pouches, inner cartons, barcodes and care labels can all be added at the factory. It is usually cheaper to do this in China than to repack in the UK, but it needs to be agreed and costed before production starts.
4. Shipping and freight
How you ship has the biggest effect on both cost and timing:
| Method | Typical transit time (guide only) | Best for |
|---|---|---|
| Express courier (e.g. DHL, FedEx) | Often around 3–7 days, but customs checks and peak periods can add time | Samples and small, urgent orders |
| Air freight | Typically 1–2 weeks door to door | Lighter, higher-value goods and time-sensitive orders |
| Sea freight (shared or full container) | Typically 5–8 weeks door to door | Larger, heavier or bulkier orders where cost matters most |
These timings are a rough guide only. Customs checks, weather, peak seasons and port or carrier delays can all add time, so always build in a buffer, especially around Chinese New Year, when factories close for several weeks.
5. Insurance
Cargo insurance is usually a small percentage of the goods value and is worth considering for larger shipments. Check what your freight forwarder or courier already covers.
6. Customs duty
Customs duty is a tax on imported goods, charged as a percentage of their value. The rate depends on the product’s commodity code, a classification number that every imported product needs. You can look up the code and duty rate for your product using the UK government’s online Trade Tariff tool. Rates vary widely: some goods are duty-free, while others, such as many clothing items, carry higher rates.
In the UK, duty is normally calculated on the value of the goods plus the cost of shipping and insurance to the UK border, not on the factory price alone.
7. Import VAT
Import VAT is charged at the standard rate of 20% for most goods. It is calculated on the value of the goods, plus shipping and insurance, plus the customs duty. If your business is VAT-registered, you can usually reclaim it, and with postponed VAT accounting you can account for it on your VAT return instead of paying it upfront at the border, which helps your cash flow.
8. Customs clearance and handling fees
Couriers, freight forwarders and customs agents charge for preparing your import declaration and clearing your goods. There may also be port, terminal or handling charges, particularly for sea freight.
9. UK delivery
Unless your shipping is door to door, you will need to pay for delivery from the UK port or airport to your premises or warehouse.
10. Testing and compliance
Many products need to meet UK safety rules before they can be sold. Children’s toys, electrical items and products that touch food or skin often need testing, certificates and the correct markings and labels. Budget for testing early, because failing a test after production is far more expensive than planning for it.
A worked example
Here is a simplified, illustrative example for 1,000 custom printed tote bags. The figures are not a quote; they simply show how the costs add up.
| Cost | Amount |
|---|---|
| Product cost (1,000 × £1.80) | £1,800 |
| Samples, including express shipping | £60 |
| Air freight to the UK | £450 |
| Customs duty (example rate of 8% on £2,250 goods + freight) | £180 |
| Clearance and handling fees | £50 |
| UK delivery to your premises | £40 |
| Landed cost (excluding VAT) | £2,580, about £2.58 per bag |
| Import VAT (20% on £2,250 + £180 duty) | £486, usually reclaimable if VAT-registered |
In this example, a bag that costs £1.80 at the factory actually costs around £2.58 by the time it reaches you. That difference is exactly why pricing your product on the factory price alone is risky.
Before you import: what you need
- An EORI number starting with GB, which you need to import goods into the UK as a business. You can apply for one on GOV.UK.
- The correct commodity code for your product, which sets your duty rate.
- A commercial invoice and packing list from the supplier.
- Any certificates or test reports your product needs to be sold legally in the UK.
- A customs agent or forwarder to submit your import declaration, unless you do it yourself.
GOV.UK has a clear step-by-step guide to importing goods into the UK if you want to read the official process.
A note on low-value orders
At the moment, goods with a value of £135 or less do not pay customs duty when imported, although VAT still applies. The UK government has confirmed that this relief will be removed by October 2028 at the latest. Most business orders are well above £135, but if you rely on small, frequent parcels from China, it is worth planning for the change now.
Hidden costs to watch out for
- Quality problems. Faulty or off-spec goods are the most expensive cost of all, because you pay for production, shipping and duty on stock you cannot sell.
- Underestimated volume. Freight is often charged on size as well as weight, so bulky, lightweight products can cost more to ship than expected.
- Exchange rates. Suppliers usually quote in US dollars, so changes in the pound can move your costs between quote and payment.
- Storage and demurrage. Goods left at a port beyond the free period can attract daily charges.
- Missing paperwork. An incorrect invoice or commodity code can delay clearance and add fees.
How to reduce your landed cost
- Get comparable quotes from several suppliers, on the same specification and the same Incoterm.
- Order sensible quantities. A slightly larger order can lower the unit price, but only if you can sell the stock.
- Choose the right shipping method. Sea freight is far cheaper than air if you can plan ahead.
- Optimise packaging so more units fit into each carton and less space is wasted.
- Approve samples before bulk production, and arrange a quality check before goods leave China.
- Use postponed VAT accounting if you are VAT-registered, to protect your cash flow.
How The Bridge Sourcing can help
We help UK businesses work out the real cost of a product before they commit. We gather comparable quotes from suitable manufacturers in China, arrange samples, follow production and check quality before dispatch, then coordinate shipping to your UK address. Our quotes show the costs clearly, so you know what you are paying for.
If you are planning an order, send us your brief and we will help you understand the most practical route. You can also read more about our China sourcing services.
This guide is for general information only and is not tax or legal advice. Duty rates, rules and thresholds can change, so always check the latest guidance on GOV.UK or with a customs agent for your specific product.
