Free Shipping Threshold Calculator
Work out the minimum order value needed for a free shipping offer to still cover your average shipping cost from margin.
Your results
Calculation breakdown
- Threshold
- Average shipping cost ÷ Profit margin
Worked example
With a $10 average shipping cost and a 35% margin, orders need to be at least $28.57 for free shipping to stay profitable.
Assumptions
- This uses a single average shipping cost, not weight- or destination-based rates.
- Many sellers round the threshold up slightly to encourage a bigger basket.
- Review the threshold if average shipping costs or margins change.
How this calculator works
Enter your average shipping cost and profit margin to see the minimum order value at which offering free shipping still leaves you in profit. Use it to set a free-shipping threshold that encourages bigger baskets without eroding profitability.
Frequently asked questions
How does this threshold work?
It calculates the order value at which your margin on the sale is enough to fully absorb the average shipping cost.
Should I set my threshold exactly at this figure?
Many sellers round up slightly above the break-even threshold to nudge customers toward adding one more item while staying profitable.
Does this account for variable shipping costs by weight or destination?
No, it uses a single average shipping cost — for widely varying shipping costs, consider tiered thresholds instead.
Results are estimates only and are not financial, tax, legal or credit advice.