Free calculators / Free Shipping Calculator
Free Shipping Calculator
Can you afford to offer free shipping?
Free shipping is never free: you pay the postage out of your profit. See what it costs you on an average order, and the order value where it starts to pay for itself.
Your numbers
- Profit when the customer pays postage
- $19.00
- Profit when you pay it
- $13.50
- Share of your profit it takes
- 28.9%
- Order value that covers the postage
- $41.26
Set free shipping at $41.26 or more and the bigger order pays for the postage.
The kit records every order with its cost and profit, so you can see what your average order really is.
See the Back Office Kit, from $19How the sum works
- Profit when you pay the postage = order value minus product cost minus postage.
- Your margin = (order value minus product cost) divided by order value.
- Order value that covers the postage = your average order plus the postage divided by your margin. At that size, the extra profit from the bigger order pays for the postage.
Questions
Should I offer free shipping on everything?
Only if your margin can carry it. For most small shops a free shipping threshold works better: postage is free over a set order value, which pays for itself by lifting the size of each order.
Where should I set the threshold?
Above your average order value, so customers add something to reach it. The figure shown here is the point at which a larger order covers the postage at your current margin.
Can I build postage into my prices instead?
Yes. Many sellers raise prices a little and offer free shipping. Check the new price against similar products, because buyers compare the total they pay.
This was one sum
The Back Office Kit runs all of them, for every product, together.
One Excel workbook that prices your products, tracks your stock, logs your orders and builds your invoices and wholesale line sheet. One payment of $19. Download the moment you pay.
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