The price on the purchase order is never the whole story. By the time a pallet lands in your warehouse, you’ve also paid freight, insurance, maybe customs duties. If those costs don’t make it into your inventory value, your margins are lying to you — every item looks cheaper than it really is.
Welcome to Round 36 of our Dynamics GP vs. Dynamics Business Central: Functionality Face-Off series — and the first of our distribution and inventory rounds. Today: landed cost. Both systems can bake freight and duties into item cost. The difference is how much machinery you have to build first.
How you do it in Dynamics GP
GP has a dedicated landed cost feature, documented in Microsoft’s Inventory Control guide. It’s genuinely capable — and it wants some setup before you touch a transaction.
- Create landed cost records. In Landed Cost Maintenance (Inventory >> Cards >> Landed Cost), define each cost: the vendor it belongs to, a calculation method — Percent of Extended Cost, Flat Amount, or Flat Amount Per Unit — whether invoices must be matched, whether inventory should be revalued, a tolerance percentage, and the posting accounts.
- Group them. In Landed Cost Group Maintenance, bundle the records into groups — say, OVERSEAS with freight, duty, and insurance records in it.
- Assign groups to item-site combinations. In Item Quantities Maintenance (Inventory >> Cards >> Quantities/Sites), attach a landed cost group to each item and site. Now the group defaults onto purchase order lines automatically.
- Apply costs at receiving. In Receivings Transaction Entry, click the Landed Cost button to open the Receivings Landed Cost Apportionment window. Pick the landed cost ID, choose how to spread it — by value, quantity, or weight — mark the Match option, and apply. Per Microsoft’s receipts documentation, landed costs can only be added at receiving — a drop-ship PO can’t have them at all.
- Match the freight bill. When the carrier’s invoice arrives, enter it in Enter/Match Invoices, mark the LC option, and open Match Shipments to Invoice. Mark each shipment item to match — or use Match Options to grab everything by receipt or PO number. Mark Revalue IV if you want inventory adjusted when the real freight differs from the estimate beyond your tolerance.
It works. But notice the shape of it: three setup windows before your first transaction, matching rules that must be decided up front on the cost record, and a hard rule that costs go on at receiving. Miss that moment, and you’re into adjustments.
How you do it in Business Central
Business Central covers the same ground with a feature called item charges, described in Microsoft’s item charges guide. The setup is one small list, and the timing is up to you.
- Set up charge codes once. Create a few item charges — FREIGHT, DUTY, INSURANCE — with a number and posting groups. No vendor tie, no calculation method, no per-item assignment required.
- Know the freight cost up front? Add a line. On the purchase invoice, under the item lines, add a line with type Charge (Item), a quantity, and the cost. Then choose Item Charge Assignment.
- Let BC spread it. Choose Suggest Item Charge Assignment and pick one of four distribution options: Equally, By Amount, By Weight, or By Volume — weight and volume come straight from the item cards. BC fills in the assignment for every line.
- Freight bill arrives weeks later? No problem. Create a new purchase invoice for the freight vendor — a completely different vendor than the one who sold you the goods. Add the Charge (Item) line, choose Get Receipt Lines, point it at the posted receipt, and suggest the assignment. Post it, and BC updates the inventory value of items you received and posted weeks ago.
- See what you’re really paying. The Item Charges – Specification report breaks down posted charges by item, so purchasing can see true landed cost by product. And the same feature works on the sales side — assign outbound freight to shipments to see the real cost of serving each customer.
Side by side
| Dynamics GP | Business Central | |
|---|---|---|
| Setup required | Cost records, groups, item-site assignments | A short list of charge codes |
| Where costs are applied | At receiving only | Order, invoice, or a separate invoice after posting |
| Spread methods | Value, quantity, weight | Equally, by amount, by weight, by volume |
| Freight bill from a different vendor | Enter invoice, mark LC, match shipments | Separate invoice + Get Receipt Lines |
| After the receipt is posted | Matching workflow with tolerances | Assign anytime — inventory value updates on posting |
| Drop-ship orders | Landed costs not allowed | Charges assignable to the invoice |
| Sales-side freight costs | Not part of landed cost | Same feature, assigned to shipments |
| True-cost reporting | Receipt inquiries | Item Charges – Specification report |
Why BC comes out ahead
Credit where due: GP’s landed cost module is thorough. Defaulting groups by item and site is real automation, and the invoice-matching flow with tolerances and revaluation is more structure than many systems offer.
But that structure is also the cost. Every vendor cost needs a record, every record needs accounts and a method, every item-site needs a group — and everything must happen at the receiving moment. In practice, plenty of GP shops skip the module entirely and expense freight, which means inventory is understated and margins are overstated.
Business Central’s item charges get the same dollars into the same item costs with a fraction of the ceremony. The charge is just a line on an invoice. It can arrive with the goods or a month after them, from any vendor, and BC will still push it into the value of the right receipts. When the correct treatment is also the easy one, it actually gets done.
Thinking about the move?
Aisling Dynamics helps GP users rebuild processes like landed cost in Business Central — usually with less setup than they left behind. Learn more about what we offer, or contact us at (251) 293-0555 to talk through what your freight and duty flow would look like in BC.
Next round: lot and serial number tracking — GP’s lot and serial tracking vs. BC item tracking codes.