The short answer is: Yes, it can be highly profitable—but only if you understand all costs and price correctly. Most beginner importers fail not because the business model is broken, but because they underestimate costs and undercut themselves on pricing. This comprehensive analysis breaks down every cost, shows real profit scenarios, and explains when importing is viable versus when it destroys capital.
The Profitability Question: Can You Make Money?
Theoretical Maximum Profit (Per Unit):
| Stage | Margin | Example |
|---|---|---|
| Manufacturer → Supplier in China | 30-50% | Makes $10 product for $5-7 |
| Supplier → You (Importer) | 20-40% | Sells you $10 product for $6-8 |
| You (Importer) → Distributor/Retailer | 20-50% wholesale | You sell $10 product for $12-15 |
| Retailer → Consumer | 50-100%+ retail markup | Retailer sells $15 product for $30-45 |
Where You Sit: As the importer, you’re in the middle. Your profit depends on:
- How cheaply you buy from supplier
- How much you mark up when selling
- How many costs you’ve accounted for (most importers miss 30-50% of costs)
The Math: If every cost is accounted for and pricing is correct, gross margins of 30-50% are typical for importers. This translates to net profit of 10-25% on successful operations.
The Complete Cost Breakdown: What Actually Costs Money
Most importers look only at product cost + freight. Professional importers account for ALL of these:
1. Product Cost (40-60% of total landed cost)
Calculation:
- Supplier quote: “FOB Shanghai $5.00/unit” (for 1,000 units)
- Minimum order quantity negotiated: 1,000 units
- Total product cost: 1,000 × $5 = $5,000 USD
Red Flags in Supplier Pricing:
- ❌ Very low prices (30-40% below market) suggest quality issues
- ❌ Refusal to provide breakdown of materials vs. labor
- ❌ Vague “all-inclusive” quotes without itemization
Negotiation Levers:
- ✅ Larger quantities (2,500 units → typically 5-10% discount)
- ✅ Repeat orders (loyalty discount 3-5%)
- ✅ Longer lead times (accept 60-90 days → 2-5% discount)
Typical Range: $2-15 per unit depending on product complexity (t-shirts: $2-3; electronics: $8-15; specialized products: $20+)
2. Shipping & Freight (15-25% of total landed cost)
Sea Freight (LCL – Most Common for Imports <15 CBM):
| Component | Cost |
|---|---|
| Factory to port in China | $50-150 |
| LCL consolidation fee | $100-200 |
| Ocean freight (Shanghai → Valparaíso) | $150-300/CBM |
| Port charges (Valparaíso) | $50-100 |
| Deconsolidation fee in Chile | $80-150 |
| Local transport (port → warehouse) | $100-200 |
| Total freight for 2 CBM shipment | $530-1,300 |
Per-Unit Cost (2 CBM / 500 units): $1.06-2.60/unit
Sea Freight (FCL – For Larger Orders >15 CBM):
| Component | Cost |
|---|---|
| 20-foot container | $2,500-3,000 |
| Local transport | $100-200 |
| Port charges | $50-100 |
| Customs clearance | $150-300 |
| Total FCL shipment | $2,800-3,600 |
Per-Unit Cost (25 CBM / 2,500 units): $1.12-1.44/unit (cheaper than LCL)
Air Freight (For Urgent Shipments):
| Component | Cost |
|---|---|
| Air freight (volumetric weight) | $7-9/kg typical |
| Airport handling | $50-100 |
| Example: 100 kg shipment | $700-900 + handling |
Per-Unit Cost (100 kg / 500 units): $1.40-1.80/unit (plus higher fees = 3-4× more expensive than sea)
Real Example (Wireless Earbuds):
- Product weight: 50 grams per unit
- 1,000 units = 50 kg shipped
- Sea freight LCL: $150/CBM × 0.5 CBM + $230 fees = $305 total = $0.31/unit
- Air freight: $8/kg × 50 kg + $75 = $475 = $0.48/unit (only 55% more expensive than LCL!)
3. Customs Duties and Taxes (10-20% of total landed cost)
Chile Tariff Rates (2026):
| Product Category | Tariff Rate | Notes |
|---|---|---|
| Electronics (most devices) | 6% MFN; 0% with FTA | China FTA = 0% if Certificate of Origin provided |
| Clothing/Textiles | 6% MFN; varies with FTA | Depends on origin certification |
| Machinery | 3-6% typically | Most industrial goods 3-6% |
| Food/Beverages | 6-15% | Higher rates for processed foods |
| Default (no FTA) | 6% (MFN rate) | Most-Favored Nation rate |
Calculation Example (Electronics with FTA):
| Item | Amount |
|---|---|
| CIF Value (Cost + Insurance + Freight) | $10,000 |
| Customs Duty (0% FTA-eligible) | $0 |
| VAT Base (CIF + Duty) | $10,000 |
| IVA Tax (19%) | $1,900 |
| Total Duties + Taxes | $1,900 |
| Per unit (1,000 units) | $1.90/unit |
Without FTA (No Certificate of Origin):
| Item | Amount |
|---|---|
| Customs Duty (6% MFN) | $600 |
| IVA Base | $10,600 |
| IVA (19%) | $2,014 |
| Total | $2,614 |
| Per unit | $2.61/unit |
Critical Insight: Missing your Certificate of Origin costs $0.71 per unit in unnecessary duties. On 1,000 units = $710 unnecessary expense. Always request COO from supplier.
Key Change (October 2025): VAT is now applied to ALL imports, regardless of value. Previously goods under US$41 were VAT-exempt. This increases taxes on small imports by 19%.
4. Customs Broker and Clearance Fees (2-5% of total landed cost)
| Fee | Amount |
|---|---|
| DIN Filing (broker fee) | $150-300 |
| Customs documentation | $50-100 |
| Port/warehouse handling | $100-200 |
| Optional: Pre-shipment inspection | $300-500 |
| Total per shipment | $600-1,200 |
Per-Unit Cost (1,000 units): $0.60-1.20/unit
Money-Saving Tip: Pre-shipment inspection costs $300-500 per shipment but prevents $15,000-50,000 losses from defective goods. ROI: 30-50× return on investment.
5. Insurance and Risk Costs (2-5% of total landed cost)
| Type | Cost |
|---|---|
| Cargo insurance (standard) | 1% of CIF value |
| Quality inspection (pre-shipment) | $300-500 per shipment |
| Return/refund buffer | 2-5% of cost (for defects) |
| Currency exchange fees | 1-2% of payment |
| Chargeback/dispute risk | 0.5-1% of sales |
Example (1,000 units, $10,000 CIF value):
| Item | Cost |
|---|---|
| Cargo insurance (1%) | $100 |
| Pre-shipment inspection | $400 |
| Return buffer | $200 |
| Total risk costs | $700 |
| Per unit | $0.70/unit |
6. Overhead and Operating Costs (10-20% of total landed cost)
Often Forgotten, But Critical:
| Cost | Amount | Per Year |
|---|---|---|
| Warehouse/storage space | $500-2,000/month | $6,000-24,000 |
| Staff (part-time importer/coordinator) | $1,000-2,000/month | $12,000-24,000 |
| Accounting and legal | $200-500/month | $2,400-6,000 |
| Website/marketplace fees (Mercado Libre, etc.) | $200-1,000/month | $2,400-12,000 |
| Marketing and advertising | $500-2,000/month | $6,000-24,000 |
| Payment processing fees | 2-3% of sales | Variable |
| Returns and shipping | $0.50-2.00/return | Variable |
| Total annual overhead | — | $29,000-90,000 |
How to Allocate to Per-Unit Cost:
If you import 2,000 units/month (24,000/year) and overhead is $60,000/year:
- Per-unit overhead: $60,000 ÷ 24,000 = $2.50/unit
This is often overlooked and can destroy profitability. Many importers think they’re profitable at $5/unit retail with $2/unit landed cost, but forget they need $2.50/unit just to cover overhead.
Real-World Profitability Examples
Scenario 1: Wireless Earbuds (High Margin, Low Complexity)
Product Details:
- Supplier price: $5.00/unit (FOB Shanghai)
- Retail target: $35-45 per pair
- Market: Direct to consumer via Mercado Libre + own website
- Order size: 1,000 units first import
Complete Cost Breakdown (Per Unit):
| Cost Component | Amount |
|---|---|
| Product cost | $5.00 |
| Shipping (sea freight LCL) | $0.31 |
| Customs duty + VAT (0% FTA) | $1.90 |
| Broker fees | $0.80 |
| Insurance + QC | $0.70 |
| Allocated overhead | $2.50 |
| Payment processing (3%) | $0.45 |
| Returns/refunds (5%) | $0.50 |
| TOTAL LANDED COST | $12.16/unit |
Pricing Strategy:
| Channel | Price | Revenue | Margin | Total Profit |
|---|---|---|---|---|
| Direct online | $40/pair | $1,000 units × $40 = $40,000 | $40 – $12.16 = $27.84/unit | $27,840 |
| Less: Mercado Libre fees (12%) | — | ($4,800) | — | ($4,800) |
| Less: Packaging/shipping to customer | — | ($2,000) | — | ($2,000) |
| NET PROFIT | — | — | — | $21,040 |
| Profit Margin | — | — | 52.6% | — |
Analysis:
- ✅ 52.6% gross profit margin before fixed costs (excellent)
- ✅ Break-even on first shipment likely within 4-6 weeks of sales
- ✅ Scalable (could import 3-5 more shipments before year-end)
- ✅ Year 1 feasibility: Import 2-3 times, net profit $40,000-60,000+ (if marketing effective)
Reality Check:
This assumes 80%+ conversion of 1,000 units to sales. If only 500 units sell in first 8 weeks:
- Revenue: $20,000 (from 500 sales)
- Costs: $12,160 (inventory cost for 1,000)
- Loss: ($200) — you’re underwater
Key Risk: Overstocking without customer demand is the fastest path to bankruptcy.
Scenario 2: T-Shirts (Low Margin, Competitive)
Product Details:
- Supplier price: $2.50/unit (FOB Shanghai; minimum order 2,000)
- Retail target: $18-25 per shirt
- Market: Online retailer and local boutiques
- Order size: 2,000 units
Complete Cost Breakdown (Per Unit):
| Cost Component | Amount |
|---|---|
| Product cost | $2.50 |
| Shipping (sea freight FCL) | $1.12 |
| Customs duty + VAT (6% tariff) | $0.58 |
| Broker fees | $0.35 |
| Insurance + QC | $0.40 |
| Allocated overhead | $3.00 |
| Payment processing + returns | $1.00 |
| TOTAL LANDED COST | $8.95/unit |
Pricing Strategy (Wholesale):
| Channel | Wholesale Price | Volume | Revenue | Profit/Unit | Total Profit |
|---|---|---|---|---|---|
| Direct retail | $18 | 800 units | $14,400 | $9.05 | $7,240 |
| Wholesaler (2x markup) | $9 | 1,200 units | $10,800 | $0.05 | $60 |
| TOTAL | — | 2,000 units | $25,200 | — | $7,300 |
Analysis:
- ⚠️ Low margin ($0.05/unit wholesale) means volume is critical
- ⚠️ Wholesalers pay $9 vs. your cost $8.95 = nearly zero margin
- ⚠️ Direct retail at $18 gives healthy $9.05/unit margin, but requires marketing/customer acquisition
- ⚠️ 40% of inventory must sell at retail or profitability evaporates
Real Profit Scenario (if 50% retail, 50% wholesale):
- Revenue: $25,200
- Profit: $7,300
- Profit margin: 29% (acceptable for competitive market)
Break-Even Analysis:
- Fixed costs per month: $5,000 (overhead: rent, staff, marketing)
- Gross profit per unit: $9.05 (retail), $0.05 (wholesale)
- Average gross profit: ($9.05 × 50%) + ($0.05 × 50%) = $4.55/unit
- Units needed to break even: $5,000 ÷ $4.55 = ~1,100 units/month
Conclusion: You need to sell 1,100+ units/month just to cover fixed costs. At 2,000 units first import with 45-day lead time, you have about 30-40 days to sell 1,100 units or go negative.
Scenario 3: Specialty Electronics (High Value, Low Volume)
Product Details:
- Supplier price: $45/unit (FOB Shanghai)
- Retail target: $120-150
- Market: Specialized e-commerce site
- Order size: 200 units (high risk product)
Complete Cost Breakdown (Per Unit):
| Cost Component | Amount |
|---|---|
| Product cost | $45.00 |
| Shipping (air freight due to urgency) | $2.50 |
| Customs duty + VAT (0% FTA) | $8.55 |
| Broker fees + documentation | $1.50 |
| Insurance + pre-shipment inspection | $1.80 |
| Allocated overhead (200 units) | $8.00 |
| Payment processing + returns | $2.00 |
| TOTAL LANDED COST | $69.35/unit |
Pricing Strategy:
| Price Point | Units Sold | Revenue | Profit/Unit | Total Profit |
|---|---|---|---|---|
| $120/unit (value positioning) | 120 | $14,400 | $50.65 | $6,078 |
| $140/unit (premium) | 50 | $7,000 | $70.65 | $3,533 |
| $150/unit (luxury) | 20 | $3,000 | $80.65 | $1,613 |
| Unsold | 10 | $0 | ($69.35) | ($694) |
| TOTAL | 200 | $24,400 | — | $10,530 |
Analysis:
- ✅ High per-unit profit ($50+ profit per unit on most sales)
- ✅ Total profit $10,530 on $13,870 investment = 76% ROI
- ✅ Niche market reduces competition
- ❌ Low volume (200 units) = 10% unsold inventory is significant risk
- ❌ If only 120 units sell (not 190): Profit drops to $5,840 (loss of $4,700+)
Break-Even Analysis:
- You need to sell only 69 units at $120 to break even ($69.35 cost × 69 = $4,785; profit on remaining 131 units covers overhead)
- This makes the business relatively safe if you can move 69+ units
The Profitability Threshold: How Many Units Must You Sell?
This is the critical question: At what volume does importing become profitable?
General Formula:
Break-Even Units = Fixed Costs ÷ Gross Profit Per Unit
Example:
- Monthly fixed overhead: $5,000
- Gross profit per unit: $5 (after landed cost)
- Break-even units/month: $5,000 ÷ $5 = 1,000 units/month
To cover year 1 setup + operating costs:
- Setup costs: $3,000-5,000 (RUT, bank account, website, initial samples)
- Annual overhead: $30,000-50,000
- Total Year 1 costs: $33,000-55,000
Break-even units (Year 1):
- At $5 profit/unit: Need 6,600-11,000 units sold
- At $10 profit/unit: Need 3,300-5,500 units sold
Reality Check:
- Conservative estimate: 3,000-5,000 units in Year 1 to break even
- Growth estimate: 15,000-30,000 units in Year 1 to be profitable ($20,000-40,000 net profit)
- Aggressive estimate: 50,000+ units for substantial profit ($50,000+)
When Importing Is NOT Profitable
Red Flags That Indicate Unprofitability:
| Scenario | Why Unprofitable | Warning |
|---|---|---|
| Product landed cost = 70%+ of retail price | No room for overhead/profit | Only 30% margin before costs |
| Wholesale margin <20% | Can’t cover fixed costs at typical volumes | T-shirts, commodities often unprofitable |
| Minimum order >5,000 units | Too much capital at risk; slow turnover | High inventory carrying costs eat profit |
| Product has high return rate (>10%) | Returns eat into margin | Electronics, fashion especially risky |
| Marketplace fees >15% of sales | Platform takes most profit | Mercado Libre/Amazon can be expensive |
| Monthly overhead >$5,000 | Need massive volume to cover | Home-based initially, scale overhead slowly |
| Lead time >90 days | Tied-up capital; slow cash flow | Quick turnaround products better |
| Commodity product (no differentiation) | Customer buys on price only; margin pressure | Compete on cost = race to bottom |
Profitability by Business Model
Model 1: Direct-to-Consumer (D2C) – Highest Margin, Highest Risk
How It Works: You import → You store → You sell directly to customers via website/Mercado Libre
Margins:
- Retail price: $40 (100% markup over landed cost $20)
- After all costs: 40-60% gross margin possible
- After fixed overhead: 15-30% net margin (if volume strong)
Capital Required: $5,000-15,000
Break-Even Timeline: 2-4 months if marketing effective
Volume Required: 200-500 units/month
Profitability: $2,000-8,000/month once established (if scaling well)
Best For: Niche products with engaged audience; high-margin items; e-commerce expertise
Model 2: Wholesale/Distributor – Medium Margin, Lower Risk
How It Works: You import → Sell to retailers/distributors at wholesale price
Margins:
- Wholesale price: $12 (retail $24 = 100% markup by retailer)
- Your profit: $12 – $8 landed cost = $4/unit (33% margin)
- After fixed overhead: 10-15% net margin (lower risk)
Capital Required: $10,000-25,000
Break-Even Timeline: 3-6 months (predictable wholesale orders)
Volume Required: 500-2,000 units/month
Profitability: $2,000-5,000/month (steady, predictable)
Best For: B2B relationships; steady volume; less marketing expertise needed
Model 3: Commission/Sourcing Agent – Lowest Risk, Lowest Margin
How It Works: You find products/suppliers for buyers; earn commission on transaction
Margins:
- Commission: 5-15% of transaction value
- No inventory carrying costs
- Minimal capital required
Capital Required: $2,000-5,000 (just operational)
Break-Even Timeline: 1-2 months
Volume Required: $20,000-50,000 transaction value/month
Profitability: $1,000-7,500/month (commission-based; lower absolute profit)
Best For: Service-oriented importers; low capital; high-touch customer service
The Year 1 Financial Reality
Conservative Projection (First Year Importing):
| Month | Units Imported | Units Sold | Cumulative Revenue | Cumulative Costs | Cumulative Profit |
|---|---|---|---|---|---|
| Month 1 | 1,000 | 200 | $2,000 | $5,800 | ($3,800) |
| Month 2-3 | 1,500 | 600 | $8,000 | $8,300 | ($300) |
| Month 4 | 2,000 | 1,200 | $16,800 | $10,800 | $6,000 |
| Month 5-6 | 3,000 | 2,500 | $36,800 | $14,300 | $22,500 |
| Month 7-8 | 4,000 | 3,500 | $56,800 | $17,800 | $39,000 |
| Month 9-12 | 5,000/mo × 4 | 4,000/mo × 4 | $96,800 | $29,800 | $67,000 |
Year 1 Summary:
- Total imported: 21,500 units
- Total sold: 17,500 units (81% sell-through)
- Total revenue: $96,800
- Total costs: $29,800 (all-in: product, freight, duties, overhead, marketing)
- Net profit: $67,000 (69% margin)
Reality Factors That Could Reduce This:
- ❌ Lower sell-through (60% instead of 81%): Profit drops to $40,000
- ❌ Higher unit costs (supplier raises prices): Margin compresses to 55%, profit $53,000
- ❌ Higher overhead (need office/staff): Fixed costs $40,000+ instead of $24,000, profit $50,000
Most Likely Outcome (Blended):
- Year 1 net profit: $35,000-55,000 (after tax: $28,000-44,000)
- Year 2 net profit: $80,000-120,000 (with established suppliers and customer base)
- Year 3+ net profit: $150,000-300,000+ (scaling operations)
The Critical Success Factors for Profitability
1. Account for ALL Costs (Not Just Product + Freight)
Most beginner importers miss 30-50% of costs. Use the complete checklist:
- ✅ Product cost
- ✅ All freight charges (inland, ocean, port, local)
- ✅ Duties and VAT
- ✅ Broker fees
- ✅ Insurance and QC
- ✅ Overhead (storage, staff, website, marketing)
- ✅ Payment processing and returns
- ✅ Currency conversion fees
- ✅ Buffer for defects (3-5%)
2. Price Correctly (Not Too Low)
The biggest importer mistake: Undercutting prices to move inventory. This destroys margin.
Better Strategy:
- Start with 40-50% retail markup (not 25-30%)
- Adjust down after 2-3 months if competitive pressure forces it
- Test price elasticity: high price with low volume often beats low price with high volume
3. Control Inventory (Don’t Overstock)
The second biggest mistake: Importing too much on first order.
Better Strategy:
- First import: 1,000-2,000 units (small, manageable)
- Test market for 4-8 weeks
- Only scale to 3,000+ units if first shipment has 70%+ sell-through
4. Choose Products Wisely
Profitable Products Have:
- Supplier cost <$5-10 (allows markup room)
- Retail price >$20 (margin enough to absorb costs)
- Shelf life stable (no expiration concerns)
- Repeat-buy potential (customers buy multiple times)
- Low return rate (<5%)
Unprofitable Products Have:
- Commodity pricing (high competition, low margins)
- Heavy/bulky (freight costs eat profit)
- High customization (longer lead times, higher costs)
- Trending products with short lifecycle (inventory risk)
5. Build Customer Base Before Scaling
Don’t scale imports faster than you can sell.
Better Strategy:
- Month 1-2: Establish Mercado Libre presence; get first 100 customer reviews
- Month 3-4: Expand to 2-3 distribution channels (own website, WhatsApp, local retailers)
- Month 5+: Scale imports to 3-5× based on proven demand
Break-Even Analysis: How Long Until You’re Profitable?
Using the Wireless Earbuds Example (Scenario 1):
| Metric | Value |
|---|---|
| Total landed cost per unit | $12.16 |
| Retail price per unit | $40 |
| Gross profit per unit | $27.84 |
| Monthly fixed overhead | $4,500 (estimate: $2,000 storage + $1,500 part-time staff + $1,000 marketing) |
| Break-even units/month | $4,500 ÷ $27.84 = 162 units/month |
| Break-even revenue/month | 162 × $40 = $6,480/month |
Timeline:
- Month 1: Import 1,000 units; need to sell 162 to break even (only 16%)
- Month 2: Sell 300 units (30% of first shipment); go positive in Month 2
- Month 3: Sell 400 units (remaining first shipment + new imports); increasingly profitable
Cumulative Profitability:
- Month 1: Break even at 162 units (likely by week 3-4)
- By end Month 2: Cumulative profit $2,500+
- By end Month 3: Cumulative profit $7,500+
- By end Month 6: Cumulative profit $30,000+
Is Importing from China to Chile Profitable?
The Short Answer: YES, but only if you:
- ✅ Account for ALL costs (not just product + basic freight)
- ✅ Price correctly (40-50% retail markup, not undercutting)
- ✅ Control inventory (small first order; scale gradually)
- ✅ Choose products with built-in margin (don’t compete on price)
- ✅ Build customer base methodically (don’t rush scale)
The Numbers:
- Year 1 realistic net profit: $35,000-55,000 (part-time, home-based operation)
- Year 2 realistic net profit: $80,000-120,000 (scaling with proven model)
- Year 3+ realistic net profit: $150,000-300,000+ (established operation)
The Risks:
- ❌ Commodity products with thin margins (unprofitable)
- ❌ Overstocking without customer demand (capital trap)
- ❌ Underpricing to move inventory (margin destruction)
- ❌ Quality issues on first shipment (reputation killer)
The Bottom Line:
Importing from China to Chile is absolutely profitable IF you understand the complete cost structure, price correctly, control inventory conservatively, and build customer base deliberately. The importers who fail are those who cut corners on cost accounting and margins, then wonder why they’re unprofitable despite “high volume.”
The importers who succeed understand that:
- Profit lies in margins, not volume
- Sustainability comes from predictable costs, not luck
- Growth comes from customer base, not inventory overstocking
- Success requires patience in Year 1 to achieve scale in Year 2+
With proper execution, importing is one of the most scalable, leveraged business models available—offering 30-50% margins, recurring revenue, and potential to grow from $0 to $200,000+ annual profit in 3-5 years.