Free calculator
Free shipping threshold calculator
The basket a free delivery offer has to reach before it pays for what it gives away, counting both halves: the shipping you absorb and the charge you stop collecting.
A free shipping threshold calculator finds the basket size at which absorbing delivery leaves you no worse off than charging for it. It counts both halves of the giveaway, the shipping you pay and the charge you stop collecting, and returns the order value that replaces them.
Your orders today
Shipping today
The offer gives up both of these at once: the cost you pay and the charge you stop collecting.
A threshold you are considering
Threshold that leaves you no worse off
€93,02
An order has to reach €93,02 net, 9,4% above today’s average, before free delivery pays for itself. Below that the offer buys orders you were getting anyway, at a discount.
21Given away per order
€11,30
cost plus lost charge
25Contribution today
€49,17
customer pays shipping
25At €99,00
€52,74
shipping free
A threshold of €99,00 earns €3,57 more per order than today, IF the basket actually reaches it. That is the assumption to test, not to hope.
See what the offer did to real ordersThe formula
Only the margin on the extra basket pays for the delivery
The instinct is to set the threshold at or just above the average order, which is almost always too low. An extra €5 of basket does not bring €5 of margin: it brings whatever survives the goods and the payment fee, commonly around three fifths of it. So covering a €4,90 delivery charge takes rather more than €4,90 of extra spend.
Both halves of the giveaway count. You start paying the carrier on orders that used to pay for themselves, and you stop collecting the delivery charge those orders used to bring. On the example figures that is €11,30 of movement per order, which is what the extra basket has to replace.
What the arithmetic cannot tell you is whether customers actually spend up to the line. That is an experiment, and the threshold is what you measure it against: watch the share of orders reaching it, and watch the average order value, together.
The fee rides the gross the gateway moved, delivery charge included, which is why it appears on both sides.
Where it goes wrong
Four ways a free shipping offer just becomes a discount
Free delivery is one of the strongest levers in ecommerce and one of the easiest to give away for nothing.
The threshold set at the average order
Half of all orders already clear the average, so a threshold set there hands free delivery to customers who were buying anyway and changes nobody’s basket. It is a straight margin cut on half the store, wearing a marketing name.
Only the shipping cost counted
The delivery charge you stop collecting is as real as the carrier bill you start paying. Counting one and not the other understates the giveaway by roughly half on a typical store, and puts the threshold well below where it pays.
One threshold for every product
A heavy or bulky product costs multiples of a light one to ship, so a single threshold subsidises exactly the orders that can least afford it. Category thresholds are more work and considerably more honest.
Never measured afterwards
The offer is a bet that baskets rise. Two numbers settle it: the share of orders that reach the threshold, and the average order value before and after. If neither moves, the offer is costing you money for nothing and should be withdrawn.
Worked example
An €85 average order, giving up a €4,90 charge
The calculator’s defaults: an €85,00 average order net of VAT, goods at 38%, a gateway taking 1,9% of the gross, €6,40 of shipping cost and €4,90 charged for delivery today.
About 59,7 cents of every extra euro of basket survives to contribution, so replacing the €4,90 charge takes €8,02 of additional spend.
So a threshold of €93 is neutral, and anything under it hands margin away. A store setting €75 “because that is about our average” would be discounting most of its orders by €4,90 and calling the result a shipping strategy.
Note what makes this store’s number relatively kind: a 62% margin after goods. A store at 40% needs a much bigger uplift to cover the same charge, which is why the threshold has to be computed rather than copied.
Questions
Free shipping, answered
What should my free shipping threshold be?
High enough that the extra basket pays for the delivery you give away. On a €85 average order at a 38% cost of goods, giving up a €4,90 delivery charge needs the basket to reach about €93 before the offer is neutral. Any threshold below that is a discount for orders you were already getting, dressed as a shipping offer.
Why is the threshold above my average order value?
Because only the margin on the extra basket pays for the shipping, not the whole of it. If roughly 60% of an order survives goods and fees, then covering a €4,90 giveaway needs about €8 of additional basket, so the threshold sits that far above the average rather than at it.
Does free shipping actually raise basket size?
Often, and never by a number a calculator can know for you. That is why this one gives you the threshold the offer must clear rather than a prediction: set it, watch the share of orders that reach it and the average order value together, and you learn your own answer within a few weeks.
Should the threshold be net or gross?
Set the threshold on the figure your customers see, which is the gross basket including VAT, but do the arithmetic on the net value, because that is what carries the margin. The calculator works in net figures, so convert once at the end rather than quietly mixing the two.
What about the payment fee on shipping?
The gateway charges its percentage on the whole amount it moved, delivery charges included, so shipping revenue is not free money: a €4,90 charge carries its own fee. It is small, and it is part of why the honest break-even threshold is slightly higher than the back-of-envelope version.
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The terms this calculator uses:
See what the offer did to the orders it changed
nouz prices shipping per order against the revenue it earned, so the month before an offer and the month after are the same statement with the difference visible on line 21.