How do I calculate margins for a distributor network?

If you import goods and sell them to distributors who sell to retailers, margin stacking occurs. Start with retail MSRP and work backward. Retailer margin is typically 40-50%. Distributor margin is usually 20-30%. You must ensure your landed cost allows you to sell to the distributor profitably while accommodating these downstream margins.

💰 Product Costing

Reseller Margin Calculator — China Import to Retail

Use our reseller margin calculator to calculate reseller margins for China imports. Analyze margin at each level: importer → distributor → retailer → consumer.

Updated: 2026-04-13

Planning Reference

Inputs Last Reviewed April 2026

Reference Basis

Built from current calculator assumptions plus typical import cost benchmarks used by China sourcing teams.

Planning Note

Use this to pressure-test margin and landed cost. Final profitability still depends on your freight quote, duty classification, and downstream selling costs.

Primary opportunity

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Landed Cost Per Unit USD Your all-in cost per unit including duties, freight, and all fees.

Selling Price Per Unit USD

Quantity units

Platform / Channel Fees % Amazon: 8–17%. eBay: 12–14%. Shopify: 0–3% + payment fees.

Reseller Margin Supply Chain

Importing for a B2B network requires careful price modeling. If your landed cost is too high, there is insufficient margin to incentivize distributors and retailers to carry your product.

The Value Chain Breakdown

Importer (You): Buys at $15 Landed. Sells to Distributor at $24. (Gross Margin: 37.5%)
Distributor: Buys at $24. Sells to Retailer at $32. (Gross Margin: 25%)
Retailer: Buys at $32. Sells to Consumer at $64. (Gross Margin: 50% / Keystone)

If your landed cost spikes to $19 due to a Section 301 tariff increase, and the retail MSRP is stuck at $64, the margins compress. If you try to pass the cost down, distributors may drop the product. Reseller models require significantly lower target landed costs compared to Direct-to-Consumer (DTC) models.

Tips for China Importers

Never compare suppliers by FOB price alone. A supplier $0.50 cheaper on FOB can easily be more expensive once freight, duty, and compliance differences are factored in. Always compare landed cost.
Include platform fees in your landed cost model. Amazon FBA referral + fulfillment fees total 30–40% of your selling price. If that's your channel, it must be in your cost calculation from day one.
Add a 15% cost contingency for your first import. First-time importers consistently underestimate costs — unexpected charges like detention fees, inspection costs, or currency moves routinely add 10–20%.
Calculate break-even units before ordering. Know exactly how many units you must sell to cover your landed cost and fixed overheads. If break-even is more than 60% of your order, the risk is too high.
Recalculate on every reorder. Freight rates, duty rates, and supplier prices all change. A cost model from 6 months ago can be meaningfully wrong. Always recalculate before committing to a new order.