This new feature rolls shipping, taxes, and other charges into per-unit inventory costs so your inventory valuation, job costing, and estimates reflect what you actually paid. This feature is currently in Early Access. If you're interested in joining the Early Access, please fill out this form.
What's new?
Today, when you purchase inventory items, shipping costs, taxes, and duties are recorded as separate expense lines on bills. Your inventory valuation based on weighted average cost (WAC) only reflects the base product cost. That means your cost of goods sold (COGS) is understated, and your estimates and job costing use inaccurate material costs. With Fully Landed Inventory Costs, you can configure a purchase order (PO) type to automatically distribute shipping, tax, and other charges across line items on receipts and bills. The allocated costs flow into your inventory valuation, job costing, estimates, and general ledger (GL) postings, giving you a complete picture of what each item truly costs.
Before and After
Before (Current)
You create a PO and receive items from a vendor.
On the receipt or bill, you enter shipping and tax amounts in the header fields.
ServiceTitan records shipping and tax as separate expense lines in the GL.
Your WAC reflects only the base vendor cost per unit.
Estimates, invoices, and job costing use the base cost, which understates what you actually paid for materials.
Impact: Your inventory valuation and job margins do not account for freight, duties, or taxes. You may price jobs too low because your cost basis is incomplete.
After
An administrator goes to Settings > Purchase Order Types, edits or creates a PO type, and selects Enable fully landed inventory costs.
Optionally, the administrator selects Include tax in fully landed costs to also roll taxes into item costs.
You create a PO using this PO type, then receive items. On the receipt screen, new fields appear for shipping, tax, and other costs at the header level.
As you enter header charges, ServiceTitan automatically distributes the costs across each line item based on item value. The fully landed unit cost calculates in real time.
When you save, the landed cost becomes the basis for WAC, estimates, COGS, and GL postings. Landed costs post to Inventory Asset instead of separate expense accounts.
Impact: Your inventory valuation, job costing, and estimates all reflect the true cost of materials, including freight, duties, and taxes. Margins are accurate, pricing decisions are better informed, and your books are cleaner.
Who uses this feature
All business types
Administrators, Accountants, Bookkeepers
Region availability: All regions
How it works for your industry
Residential Service and Replacement
A plumbing company orders 50 water heaters from a vendor. Freight costs $500 and duties cost $200. With fully landed inventory costs enabled, those charges are distributed across all 50 units on the receipt. Each unit's cost now includes its share of shipping and duties, so when a technician installs a water heater and it goes on the invoice, the job margin reflects the true material cost.
An HVAC company receives a bill for refrigerant with $150 in shipping. Instead of recording the shipping as a separate expense, the cost is allocated to each line item. The updated WAC means the next estimate that pulls this item's cost will include the freight, helping the company avoid underpricing future jobs.
An electrical contractor receives serialized panel boards. The fully landed cost flows through to each serial number, so when one panel is used on a job, the exact landed cost appears in the job cost report.
Commercial Service and Replacement
A large commercial HVAC contractor receives a shipment of rooftop unit (RTU) compressors with high freight charges. Fully landed costs distribute the freight across each compressor on the receipt. When the compressor is used on a service job, the job costing report shows the full material cost, including transportation.
A commercial plumbing company handles multi-location vendor shipments. Each receipt captures other costs such as tariffs and handling fees. These costs are allocated proportionally so that each item's WAC reflects the true acquisition cost across all locations.
A fire protection contractor receives specialized valves with import duties. The landed cost per valve is accurate on the bill, so when the contractor builds an estimate for the next commercial project, the material cost includes duties from the start.
How to prepare?
Join the Early Access for this feature by filling out this form.
Once participating in the Early Access:
Make sure you have the Fully Landed Inventory Costs and any prerequisite configurations enabled. Prerequisites include the Inventory module, Purchasing module, and Weighted Average Costing.
Identify which PO types should use fully landed costs. Consider creating a new PO type specifically for vendors where freight and duties are significant. Go to Settings > Purchase Order Types to configure.
Decide whether to include tax in fully landed costs. This is a separate setting per PO type. If your company already handles tax through a different GL workflow, you may want to leave tax excluded.
Train your purchasing and accounting teams on the new receipt and bill fields. When fully landed costs are enabled, receipts and bills display new columns for additional landed cost per unit, fully landed unit cost, and a breakdown of how costs are allocated.
Bookmark any knowledge base articles or Academy videos for team training.