For a small food business, delivery charges should be assigned to the delivery batch or goods they relate to, then spread across the usable units on a consistent basis. For a homogeneous bulk order, the basic calculation is:
Delivery cost per usable unit = attributable delivery charge ÷ usable units received
For landed-cost analysis, the resulting per-unit delivery cost should be added to the product cost. The International Trade Administration describes landed cost as the total product price once it has arrived at the buyer’s doorstep and includes insurance, freight, tariffs and taxes, and other fees.
Separate the delivery cost pool
The calculation starts with the quote or invoice. Each delivery-related amount should be matched to the shipment or products it covers. If one bulk order arrives in separate batches, assigning each charge to its relevant batch prevents one delivery from distorting the unit economics of another.
The supplier’s own allocation should be retained when reconciling the invoice. If internal analysis uses a different allocation basis, that alternative should be labelled as an internal management allocation so that the same charge is not counted twice.
IAS 2 separately identifies transport and handling as costs directly attributable to acquiring inventory. That supports their relevance to inventory acquisition, but the cited wording does not establish that every line described as a delivery charge has the same accounting treatment.
Choose a consistent allocation basis
For a homogeneous order, the clearest approach is to normalize packs or cases into a common unit and divide the attributable delivery charge by the usable units received. Any units excluded from the denominator should be documented.
A mixed order may require an allocation key. For internal analysis, relative purchase value, weight, volume or unit count may be considered when the selected key reasonably reflects the shipment being allocated. The key should then be applied consistently and retained with the supporting records.
Neither cited source statement prescribes a universal allocation key for a mixed bulk order. The selected basis is therefore a management assumption unless the invoice or contract documents another method for billing.
Include the result in landed cost
After allocating the delivery charge, the per-unit landed cost can be expressed as:
Landed cost per usable unit = product cost per usable unit + applicable insurance, freight, tariffs and taxes, and other verified fees per unit
Not every amount needs the same accounting treatment merely because it affects landed cost. The landed-cost view and the inventory-accounting view should be recorded separately where necessary, with the treatment of each item checked against the applicable records and requirements.
What the buyer must still confirm
Before relying on the figure, the buyer should confirm:
- What the delivery charge covers and which products or batches it affects.
- Whether the invoice already uses an allocation method.
- How packs and cases convert into the unit used for the calculation.
- How many units were actually received and remain usable.
- Whether shortages, damage, returns or delays affect the charge under the applicable documents.
The cited definitions do not establish a refund, cancellation or other contractual right. Any such effect must be confirmed in the relevant invoice, quotation and contract rather than inferred from the general landed-cost definition.
Once verified, retaining the cost pool, allocation key, unit count and supporting invoice makes the per-unit calculation reviewable and keeps delivery charges visible in the landed-cost analysis.