How to allocate import freight to SKU costs by volume

Start with the freight attached to a shipment

An imported purchase has a supplier price and recorded shipping costs. Wholety's supply settlement allocates freight within each shipping record using each SKU's share of volume. One purchase may have multiple containers, with separate product allocations and costs for each shipping record.

The example below explains that volume-based allocation. It includes purchase price and a single freight amount; it is not a complete model of customs duties, insurance or every cost that might occur in a real import.

A two-SKU worked example

Suppose one shipping record contains 10 units of SKU A and 20 units of SKU B. A unit of A occupies 0.5 m³, while a unit of B occupies 0.25 m³. The shipping record has CAD 1,000 of freight to allocate.

Each SKU contributes half of the shipment volume, so each receives half of the freight. The total unit quantities differ, so the freight cost per unit differs.

• Total SKU volume = unit volume × shipped units.
• Allocated SKU freight = shipment freight × SKU volume ÷ total shipment volume.
• Freight per unit = allocated SKU freight ÷ shipped units.

Should freight be allocated by volume, weight or value?

Choose a basis that reflects how the charge was incurred and keep that choice consistent within the shipment. Volume can make sense when bulky items drive container space; weight can make sense for a weight-based freight charge; value may be relevant to an ad valorem charge. These bases produce different SKU costs. The Wholety supply-settlement example on this page uses volume-based freight allocation; do not assume the application automatically applies the other methods. Record other charges and accounting decisions according to your actual process.

If the supplier purchase prices are CAD 100 per unit of A and CAD 40 per unit of B, purchase price plus this freight is CAD 150 and CAD 65 per unit respectively. These figures are illustrative and do not add other costs or taxes.

Check the inputs before settlement

Review the SKU volume, quantity allocated to the shipping record and the freight recorded for that shipment. Applying the entire purchase quantity to each container would distort the allocation when an order ships in multiple containers.

Wholety allows a SKU volume override on the settlement page when a volume needs correction for that allocation. The documented override affects that allocation without changing the product master. Maintain product volume accurately so that both allocation and loading calculations use meaningful inputs.

Confirm cost before settling the sale

At supply settlement, confirmed freight is written to the corresponding stock cost, and the purchase reaches Settled state. Sales settlement depends on the linked supply purchase already being settled, so that sales profit uses a confirmed cost.

This is separate from registering the actual payment to the supplier. Cost confirmation establishes the purchase cost; a finance payment record describes money paid. A purchase can have several payments, so a single payment entry should not be confused with the entire cost-settlement workflow.

Use the records to explain a margin difference

If the margin on a sale looks unexpected, inspect its source purchase and shipping record before changing the sales price. Compare the order's price snapshot, allocated freight, units and volume. Confirm that you are looking at the stock from the relevant source purchase, since the same SKU can have inventory from different purchases.

Read shipping information and supply settlement for the application steps and supplier payments versus settlement for the finance distinction. The purchase order management page connects these operations to the wider workflow.

Multiple containers and repeated SKUs

Assign each purchase line to one shipping record. Split a line before approval if it will travel in different containers. Every shipment allocates its own freight by the volume of its assigned goods. When a SKU appears on several purchase lines or shipments, Wholety combines those allocated amounts and divides by the original purchased quantity to calculate its weighted unit cost. Remaining stock after sales or transfers does not change that denominator.

For example, one unit bought at CAD 10 and three at CAD 20 give a weighted purchase price of CAD 17.50. Freight of CAD 10 and CAD 90 across their shipments adds CAD 25 per unit. An order discount reduces the purchase component; it does not change the separately recorded freight. Purchase payable remains goods plus the order discount.

The confirmation page uses the same calculation as the server. Temporary volume corrections apply to this confirmation and leave the SKU master unchanged. Confirmation retains a cost snapshot and freezes freight amounts and cargo assignments. Older analyzed orders keep their recorded costs.

Estimate the shipment total first

Use the free landed cost calculator to add goods, freight, insurance, duty and other included charges before allocating shared costs to each SKU. A shipment-wide per-unit average is only suitable for comparable units; use the volume method above when product sizes differ.

Explore a complete example before entering your own data

Start your free month without a credit card or an inventory import. New owner workspaces open with a clearly labeled, fictional wholesale business: three products, supplier purchases, partial receiving, stock reservations, customer sales and recorded payments. You can trace the same SKU across the workflow instead of filling an empty system before seeing how it works.

Continue the homepage’s Harbor Market example with the same three SKUs. Over 90 days the customer ordered 120 cases of HBT-24 oolong tea, 90 of GNG-12 ginger drink and 60 of SPK-24 sparkling water. Available stock is 60, 18 and 72 cases respectively. Requesting another 48 of each leaves a 30-case shortfall in ginger drink. The original 12-case tea batch ends at A2 with 9 cases and B3 with 3, just as the warehouse animation shows. The example is read-only and separate from your business records. Choose Close example and start using Wholety before entering your own data. For self-service buyer ordering, see the B2B ordering portal; for the next Agent task, use the stock-check and purchase-draft walkthrough.