Your factory quoted you $4.20 per unit. You multiplied by the order size, compared it to domestic pricing, saw you'd save 35%, and signed. Three months later you're doing the landed-cost reconciliation and the real number is $5.85. You didn't get ripped off — you just didn't ask about the seven costs that were never in the quote.
This article catalogs every line you should have priced before you placed the PO.
The seven line items
1. Ocean freight + port fees
A 20-foot container from Mumbai to Los Angeles runs roughly $2,800–$4,500 in 2026 (the post-pandemic rate ceiling has receded but is still well above 2018 baselines). Port fees at both ends — terminal handling, documentation, security surcharges — add another $400–$800.
On a 1,000-unit t-shirt order that fits in a partial container (LCL), you'll pay LCL rates of $95–$130 per cubic meter, roughly $400–$700 for the shipment. On a 10,000-unit order that fills a container, it's $4,000–$5,000 flat.
Rule of thumb: add $0.35–0.55 per unit for sea freight on sub-container orders. Less at container scale.
2. US customs duty
HTS classification determines everything. Most woven cotton apparel from India sits at 16.5% duty. Knit cotton is often 16.5–19%. Synthetic-blend activewear can be 32%. Accessories and non-apparel (bags, bandanas) are usually lower, 6.5–9%.
Get your HTS code from the factory in writing before you finalize — they know the correct classification for the product, and an incorrect code caught at customs means either paying the higher rate retroactively on the shipment or losing two weeks to a reclassification review.
Rule of thumb: add 16–19% of FOB value for cotton apparel, 20–28% for synthetics, 6–9% for non-apparel.
3. US broker + ISF fees
Your customs broker charges $125–$275 per entry regardless of shipment size, plus the ISF (Importer Security Filing, a.k.a. "10+2") fee of $35–$75 per shipment. Brokers also charge for classification advice, CBP exam attendance, and document handling — budget $400–$600 per shipment total.
Rule of thumb: $0.04–$0.10 per unit on a 10,000-unit order, more on smaller orders.
4. US 3PL receiving, storage, and pick-pack
Your 3PL charges a receiving fee ($8–$15 per carton), a per-pallet storage fee ($15–$35 per pallet per month), and a per-order pick-pack fee ($2.50–$4.50 plus pennies per unit). On a 10,000-unit shipment spread over a 3-month sell-through, you're looking at $0.25–$0.60 per unit in 3PL cost before the unit even ships to a customer.
Some 3PLs quote flat-rate programs for steady SKUs that reduce this to $0.15 per unit all-in. Negotiate that explicitly if your volumes warrant.
5. QC rework
India's best factories ship at 98–99% pass rate, which sounds great until you realize 1,000 units at 98% pass rate means 20 defects. On a small order, 20 defects is a measurable percentage of the SKU. Either you absorb the loss (write off 2% of units) or send the rework back to the factory (freight both ways, another 2–4 weeks, $0.15–$0.30 per affected unit).
Rule of thumb: budget 1–2% of units as non-sellable on the first run with a new factory. Goes down to 0.3–0.8% after 2–3 runs as QC stabilizes.
6. Sample revision loops
The factory quote covers the first sample. It does not typically cover revisions. Most factories charge $80–$180 per revision (cost of a sew operator day + material), and a typical new product needs 3–5 revisions before it's approval-ready.
Rule of thumb: $300–$800 in sampling cost per new SKU, a one-time fee paid before the bulk run.
7. Forex exposure
Your factory quotes in USD (most do) but pays workers and suppliers in INR. When the rupee weakens 4% over the 90 days between quote and shipment, the factory either eats the difference or (more commonly) passes it through as a "raw material adjustment" or "forex charge" on the final invoice.
Some factories will lock a rate for 60–90 days on request. Ask. If they can't, pad your budget 3–5% for currency movement on quotes placed more than a month before the bulk run.
Putting it together
On a 5,000-unit t-shirt order FOB Mumbai at $3.60:
- Factory FOB: $3.60
- Sea freight (LCL, partial container): $0.30
- US duty (16.5%): $0.59
- Broker + ISF: $0.08
- 3PL receiving + storage (6 months): $0.35
- QC rework (1.5% non-sellable): $0.05
- Sample amortized over 5,000 units: $0.10
- Forex buffer (3%): $0.11
Landed cost: $5.18 per unit — 44% above the quote you saw on paper.
None of this means India is more expensive than you thought. Domestic US manufacturing of the same shirt runs $7.50–$9.00, no freight savings, no duty relief, same QC rework, same sampling cost. The ethical-India landed cost is still 30–40% less than US domestic. But you have to price it honestly at the outset, not discover it in the Q3 P&L.
Frequently asked questions about India import costs
Should I ask for FOB or DDP pricing?
Most factories quote FOB Mumbai (or FOB Chennai, Delhi, etc.) by default. DDP ("delivered duty paid") quotes wrap freight, duty, and broker fees into one number — simpler, but the factory typically pads the logistics line 15–20% to cover its own risk. For first-time buyers, FOB plus a separate freight forwarder is usually cheaper and gives you line-item visibility. Once the relationship is stable, DDP can save you broker management time.
How do US tariffs on Indian apparel work in 2026?
As of 2026, the US MFN (Most Favored Nation) duty on most finished apparel from India sits around 14–19% depending on HTS code and fabric composition. India is not a GSP beneficiary for apparel (those benefits were revoked in 2019 and haven't been restored for textiles). Some knit vs woven vs non-apparel products have meaningfully different rates — get your HTS classification right before you finalize your quote math.
Is sea freight or air freight worth the difference?
Sea freight from Mumbai to the US East Coast runs roughly $2,500–$5,000 per 20-foot container (post-2023 rates) and takes 4–6 weeks door-to-door. Air freight runs $5–$8 per kg and takes 3–7 days. On a 1,000-unit t-shirt order weighing ~200 kg, sea is ~$500 and air is ~$1,400. Air is only worth it for launch-critical delays or very high-value goods — on most apparel, the answer is book earlier and ship sea.
What goes wrong after the container arrives?
Customs holds for random inspection (1–4% of shipments, 2–7 day delay), document discrepancies between commercial invoice and packing list (delays clearance, may trigger full customs exam), 3PL receiving backlogs in peak seasons (Q4), and split shipments arriving days apart because the factory closed the container late. Build a 10–14 day buffer past your ETA.
Related reading
- Apparel MOQs Explained: Why Factories Set Minimums — why small orders amortize these fixed costs badly.
- What "Ethical Manufacturing" Actually Costs Per Unit — FOB-price breakdown to complement the landed-cost view.
- Sampling to Bulk: A Realistic Timeline — where the sample-revision line item lives in the calendar.
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