COGS, Inventory & Freight Glossary

Also: Airfreight, Air Cargo, A/F

Cost of shipping goods by air. More expensive than ocean freight but significantly faster, typically used for urgent or high-value shipments.

Also: Bunker Adjustment Factor, Fuel Surcharge

Fuel surcharge for shipping that fluctuates with oil prices. Shipping lines use this to adjust rates based on current fuel costs without changing base freight rates.

Also: Currency Adjustment Factor

Currency fluctuation adjustment applied by carriers when exchange rates move significantly. Protects carriers from currency risk on long-term contracts.

Also: Container Freight Station, CFS Charge

Container freight station handling charges for consolidating or deconsolidating LCL cargo.

Also: Final Delivery, Last Mile

Final delivery to destination warehouse or facility. The last leg of transportation in the supply chain.

Also: Detention, Container Demurrage

Charges for holding containers beyond the free time allowed at port. Avoid by clearing and returning containers promptly.

Also: Doc Fee, Documentation, B/L Fee +1 more

Shipping documentation charges for preparing bills of lading, export/import documents, and other required paperwork.

Also: Cartage, Local Delivery, Local Cartage

Local trucking from port to warehouse or rail terminal. Short-distance transport typically within the same metropolitan area.

Also: Full Container Load

Full container load shipping where the entire container is used by a single shipper. More cost-effective per unit for larger shipments.

Also: Frt, Freight Charge

General freight cost for transporting goods. A generic term that may include various transportation charges.

Also: Handling Fee, Handling Charge

General handling fees for physically moving, sorting, or processing cargo at various points in the supply chain.

Also: Inland Transport, Domestic Freight

Domestic transportation costs for moving goods from port to final destination. Can include road, rail, or inland waterway transport.

Also: ISPS Fee, Security Fee

International Ship and Port Facility Security fee mandated by the IMO. Covers security measures at ports and on vessels.

Also: Less than Container Load, Groupage

Shared container shipping where multiple shippers share container space. Cost-effective for smaller shipments that don't fill a full container.

Also: Sea Freight, Seafreight, O/F

Cost of shipping goods by sea. This is typically the largest freight cost for importers using containers from Asia, Europe, or other overseas markets.

Also: Origin THC, Origin Terminal Handling

Terminal handling charge at Chinese origin ports. Covers loading and container handling at the export port.

Also: Collection, Pickup Charge

Collection from origin, typically a factory or supplier warehouse. The first leg of freight transportation.

Also: Ship, Shipment

General shipping cost covering the movement of goods. This may appear as a catch-all term on invoices.

Also: Terminal Handling Charge, Terminal Handling

Port terminal handling fees for loading/unloading containers. Covers the cost of moving containers within the port terminal using cranes and other equipment.

Also: Verified Gross Mass, Container Weighing

SOLAS verified container weight certification. Mandatory weighing of packed containers before loading.

Also: Wharf Fee

Charge for using wharf facilities at the port. Covers the cost of port infrastructure.

Also: ADD, Dumping Duty

Additional duty applied to goods sold below fair market value to protect domestic industries from unfair foreign competition.

Also: CVD

Duty to offset foreign government subsidies that give imported goods an unfair price advantage in the domestic market.

Also: Excise, Excise Tax

Tax on specific goods like alcohol, tobacco, and fuel. Applied in addition to regular import duty.

Also: Goods and Services Tax

Australian Goods and Services Tax at 10% on most imported goods. Similar to VAT in other countries.

Also: Harbor Maintenance Fee, Harbour Maintenance Fee

US Harbor Maintenance Fee at 0.125% of cargo value. Funds the maintenance of US ports and harbors.

Also: Customs Duty, Duty, Tariff

Government tax on imported goods based on the value and classification of products. Rates vary by product type and country of origin.

Also: Value Added Tax, Import VAT

European Value Added Tax charged on imports. Rates vary by EU member state, typically 17-27%.

Also: Customs Bond, Surety Bond

Customs bond requirement guaranteeing payment of duties and compliance with import regulations.

Also: CIQ Fee, CIQ Inspection

China Inspection and Quarantine fee for quality and safety inspection of exports.

Also: Clearance, Customs Brokerage, Brokerage

Customs broker fees for clearing goods through customs. Includes preparing documentation and dealing with customs authorities.

Also: DAFF Fee, Biosecurity Fee

Australian biosecurity inspection fee. Australia has strict quarantine requirements to protect its unique environment.

Also: Entry Summary Declaration

EU Entry Summary Declaration required for all goods entering the EU customs territory for security risk analysis.

Also: Customs Entry, Import Entry

Fee for processing customs entry documentation. A standard charge for each import declaration submitted.

Also: Customs Examination, Inspection

Physical examination of goods by customs officials. May involve unpacking and inspecting container contents.

Also: FDA Fee, FDA Prior Notice

US FDA-related charges for food, drug, medical device, and cosmetic imports requiring FDA clearance.

Also: Fumigation Fee, Pest Treatment

Treatment for pest control, often required for wooden packaging or agricultural products entering countries with strict biosecurity.

Also: Integrated Cargo System, ICS Fee

Australian Integrated Cargo System fee for electronic cargo processing and reporting.

Also: Importer Security Filing, ISF Fee, 10+2

US Importer Security Filing requirement (also known as 10+2). Must be filed 24 hours before vessel departure.

Also: Merchandise Processing Fee

US Merchandise Processing Fee charged by CBP for processing import entries. Currently 0.3464% of value with minimum and maximum limits.

Also: Quarantine Inspection, AQIS

Quarantine inspection fees for checking goods that may pose biosecurity risks. Common for food, plant, and animal products.

Also: USDA Fee, USDA Inspection

US Department of Agriculture inspection fee for agricultural products, meat, and plant-based imports.

Also: X-Ray Inspection, Scanning

Container x-ray scanning fee for security screening. Random or risk-based selection by customs authorities.

Also: All Risk, Comprehensive Insurance

Comprehensive cargo coverage protecting against all risks of physical loss or damage, with specified exclusions.

Also: Marine Insurance, Freight Insurance, Insurance

Insurance for goods in transit protecting against loss, damage, or theft during transportation.

Also: Agent Fee, Agency Charge

Freight agent service fee for coordinating shipments and acting as an intermediary between shipper and carrier.

Also: COGS Journal, Cost of Sales Journal

The bookkeeping entry that records cost of goods sold for a period: debit COGS (an expense) and credit Inventory (an asset) for the cost of the units sold. It moves cost off the balance sheet and onto the P&L so gross profit is stated correctly. Landara produces a ready-to-post Dr COGS / Cr Inventory journal each period. You review and post it in Xero or QuickBooks; Landara never writes to your ledger.

Also: Comm Fee, Communication Fee

Communication and admin charges for correspondence, tracking updates, and administrative work.

Also: COGS, Cost of Sales

The direct cost of the inventory you sold in a period: what those units actually cost you to buy and land, not what you sold them for. COGS is booked against revenue to reveal gross profit. For importers, accurate COGS means folding freight and duty into unit cost, not just the supplier price. Landara calculates COGS on every Shopify order and hands you a journal to post.

Also: FIFO, First In First Out

An inventory costing method where the oldest stock you bought is treated as the first sold. Each receipt becomes a dated cost layer, and every sale depletes the oldest layer first, so your COGS reflects what those specific units cost. FIFO is the most common and widely accepted method under both IFRS and US GAAP. Landara costs each Shopify order FIFO by default (moving average is also available).

Also: Cost Layer, FIFO Layer

A dated batch of stock recorded at the cost you paid for it, including landed costs like freight and duty. Under FIFO, each purchase or receipt creates a new layer, and sales consume the oldest layers first. Tracking layers is what lets a perpetual system report the true cost of each unit sold. Landara builds a cost layer from every stock receipt and depletes them as Shopify orders ship.

Also: Stock Sub-ledger, Inventory Subledger

A detailed record of inventory movements and costs that sits behind, and reconciles to, the single inventory figure in your general ledger. It shows the per-SKU cost detail your accounting software cannot, giving you an audit trail for how COGS was calculated. Landara acts as a lightweight cost sub-ledger for Shopify stores, backing up the COGS journal you post.

Also: Label, Relabeling

Product labeling charges for applying required labels, barcodes, or compliance markings.

Also: Weighted Average Cost, Average Cost, AVCO

An inventory costing method that blends all units on hand into a single average unit cost, recalculated each time you receive new stock at a different price. Simpler than FIFO because there are no separate layers to track, but it smooths over cost changes rather than matching each sale to a specific purchase. Landara supports moving average as an alternative to FIFO for costing Shopify orders.

Also: Packaging, Crating

Packing or crating charges for preparing goods for shipment with protective packaging.

Also: Pallet, Palletizing

Palletizing charges for arranging goods on pallets for easier handling and shipping.

Also: Periodic Inventory System

An accounting approach that only calculates cost of goods sold at the end of a period, typically using a physical stock count and the formula opening inventory + purchases − closing inventory. Simple but backward-looking: you cannot see margin per order during the period. Perpetual costing (what Landara provides) is the modern alternative that keeps COGS current in real time.

Also: Perpetual Inventory System

An accounting approach that updates inventory value and cost of goods sold continuously, with every sale and receipt, rather than only at period end. It gives you an always-current COGS and inventory figure instead of a once-a-month estimate. Landara runs a perpetual FIFO cost ledger against your Shopify orders so your COGS is accurate order by order.

Also: Stocky, Stocky by Shopify

Stocky was Shopify's inventory and purchase-order app, bundled with Shopify POS Pro and used by many stores to track stock cost and COGS. Shopify has now retired it, and directs former Stocky users to the Shopify admin and Shopify POS. That leaves those stores with no built-in way to track inventory cost or produce a COGS journal. Landara fills that gap on the cost side: it costs every Shopify order using perpetual FIFO (or moving average) and hands your bookkeeper a ready-to-post journal, without replacing how Shopify tracks quantity.

Also: Warehouse Storage, Warehousing

Storage charges at warehouse facilities for holding inventory before distribution.