Cost

The true landed cost of sourcing from India — and where 20% hides

The cheapest quote is rarely the cheapest order. If you are comparing suppliers on FOB alone, you are optimising the wrong number. Here is what really lands on your shelf — and where up to 20% of savings actually comes from.

Price is the tip. Total cost is the iceberg.

Total cost of ownership spans three phases: pre-transaction (sourcing, vetting, sampling), transaction (unit price, freight, duties) and post-transaction (defects, returns, rework, delays). A low FOB that generates a 5% defect rate and a two-week delay is not cheap — it is expensive with a discount on the label.

Where a real 20% saving comes from

• Smart negotiation (~6%): three-vendor quotes and cost-breakdown requests expose hidden margin.
• Freight consolidation (~5%): fewer, fuller containers and the right corridor cut logistics spend.
• Tax & duty (~5%): FTAs and bonded warehousing reduce duty drag.
• Process efficiency (~4%): one owner managing the order removes rework, errors and delay costs.

Stacked together — and only when someone is actively managing them — these levers routinely recover up to 20% of landed cost, without touching quality.

The number that decides everything

Track landed cost per unit, not FOB. It is the only figure that reflects what the product truly costs sitting in your warehouse, ready to sell. Once you manage to that number, India stops being a gamble and becomes one of your highest-margin sourcing markets.

See it on your own numbers

We build a landed-cost model for your specific product on a free consultation call — so you can compare India against your current source on the figure that actually matters.

Keep reading