It Took Me 17 Years in Supply Chain to Understand This About Landed Cost

I want to start with something that took me an embarrassing long time to understand, given that I've been doing this for 17 years. There's no such thing as the number. I used to talk about landed cost like it was a fact, like you go and find it and then you have it. But your landed cost has at least 4 moving parts, and they move on 3 completely different clocks. Your unit cost, From the supplier moves when they renegotiate or when their input costs move, usually with some notice, sometimes with none. Your freight moves seasonally and by lane, and right now it's forecast to climb 10 to 20% heading into peak. Your duty line moves when Washington moves, which this year has been 4 times since February. And if you're paying in a currency you don't Even earning. Foreign exchange moves every single day and nobody on your team is watching it. So 4 parts, 3 clocks, and the honest version is that landed cost is not a fact. It's a snapshot with a date stamped on it, and a date matters as much as the number. So here's why I'm opening the alignment video with that, because the reason ops and marketing end up holding different numbers isn't usually that somebody was careless. It's that they're holding snapshots from different weeks and both of them think they have the current one. And nobody's wrong, but everybody's misaligned. It's a much harder problem to spot than somebody making a mistake because there's no mistake to find. I'm Lara. This is MOOC Supply Chain. Last week we built a per SKU repricing sheet. Today is about the handoff, which is the part that actually breaks. So let's do the marketing side properly because marketing is not the villain in this story and a lot of supply chain people talk like they are. 7 moves, but I want to frame them differently than you'll see them framed anywhere else. None of these are marketing strategy. Every one of them is a marketing responding to an operation fact doesn't control. That framing matters because it tells you where each one actually breaks. Now, 1, draft the price change communication before you need it. Most brands write this the day they have to raise a price, which is exactly the wrong day to be deciding tone. Write it now while there's nothing to put out. 2, stop promising what tariffs won't let you keep. I'm seeing price lock guaranteed in campaigns right now, and I understand the instinct. It's a strong hope With 4 regime resets since February, a guarantee you can't keep isn't marketing. It's a liability with good copywriting on top. 3, use cost transparency as a trust asset. A short, honest post about why supply chain costs are unpredictable right now builds more credibility than going quiet and hoping nobody notices the price move. Customers respond well to a brand that explains itself before it has to. 4, segment messaging and spend by margin resilience. This one is only possible if ops gave marketing SKU-level data, which in most brands they never have. Marketing has revenue by SKU. They almost never have margin by SKU. Those produce completely different decisions, and only one of them is right. 5, shift toward retention and lifetime value framing during unstable cost stretches. A discount-led acquisition push is riskier to fund when the cost base underneath it can move before the campaign finishes running. Now, 6, pre-build the rapid response template for supply disruption messaging so a delay gets a same-day message instead of one drafted while customers are already in the inbox. 7, coordinate promo depth with the actual current number. Check every H2 discount against the per SKU rule from the last week and against today's landed cost, not last month's assumption. Now, 6 of those 7 require marketing to have information that lives in operations, which means the moves are not really the answer. The plumbing is. So here's the plumbing. One shared KPI, and I argue there's only one that works: contribution margin per order. Not revenue, because revenue rewards discounting. Not gross margin, because it hides fulfillment and shipping. Contribution margin per order is the only number where a marketer running a promo and an ops lead negotiating freight can both see whether their decisions help or hurt. In the same units. When both sides are held to it, a lot of the arguing just stops because you're no longer debating priorities. You're looking at the same scoreboard. And one meeting, 15 minutes, weekly, same time, 3 things on the agenda and nothing else. What's the current landed cost snapshot and what date is it about? What changed last week? What decision does that change this week? And who's gonna make it? 15 minutes, that's the whole intervention. I have to be honest about something though, because I've built this meeting for clients and watched it fail. The meeting doesn't work on its own. What makes it work is whether the people in it have permission to kill a plan. If marketing shows up, learns the cost move, and then still has to run the promo because it's already in the calendar and so But if somebody senior signed off, the meeting is expensive fear because now everyone knows it's going to lose money and they run it anyway. So the actual requirement isn't the meeting, it's permission. Somebody in that room needs authority to say we're not running that and have to stick. If you can't give that authority to anyone yet, at least be honest with yourself that what you have is a status update, not an alignment mechanism. Now, the owner's test. What it's called, give it a name, the margin review, for example, 15 minutes, choose dates. Who runs it when you're not in the room? And this is the whole thing this week. If you run this meeting, it isn't an alignment mechanism. It's you doing translation between 2 teams, which is technician work with a nicer title. You're the interpreter. And interpreters cannot take holidays. When does it refer? Weekly, on their calendar, and it should happen when you're away. That's the actual test, not whether it's good when you're there. Where is it written down? One page. What gets reviewed in what order, and who decides what? Michael Gerber's framing on this is the one that I— how I think about my own business. Innovation, quantification, orchestration. You find a better way, you measure whether it's actually better, and then you build it into the system so nobody has to use judgment on it again. Most of us are good at the first one, occasionally to the second, and almost never on the third. And the third one is the only one that removes you. I'll say plainly that I'm not through this myself. These are meetings that move that still need me in the room, and I know exactly which ones, and I'm working on it. So I'm not preaching from the other of it. I'm just fairly sure it's the right direction.