Rex says
Money math without the spreadsheet headache. Plug in your numbers and I'll show you exactly where the dollars land.
Try a scenario
Click to load — tweak from there.Inputs
Result
Net monthly margin impact
-$3,480
Margin lift from upsizing
$2,520
Shipping cost given away
$6,000
Estimated new blended AOV
$52.20
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How to use this
- 1Enter current average order value ($).
- 2Enter average shipping cost per order ($).
- 3Enter proposed free shipping threshold ($).
- 4Enter % of near-threshold customers who add items (%).
- 5Enter margin on items added to qualify ($).
- 6Enter orders per month near this range.
- 7Read your net monthly margin impact on the right — it updates as you type.
- 8Hit Share to keep the scenario or send it to someone.
About this calculator
A free shipping threshold works by getting customers who would have ordered below it to add items and cross the line, lifting average order value. But if you set the threshold too low relative to your current AOV, you're just giving away shipping on orders that would have happened anyway, without the offsetting AOV lift. This calculator compares your current average shipping cost you absorb per order against a proposed threshold, using an assumed percentage of customers who will add items to reach it, to show the net margin impact of introducing or changing a free shipping threshold. Enter current AOV, average shipping cost you currently charge or absorb, proposed free shipping threshold, expected percentage of near-threshold customers who add items to qualify, and their added item margin. The output shows net margin impact per order and whether the threshold is likely to pay for itself through AOV lift versus simply costing you shipping margin on existing order volume.
Worked example
Using the values the calculator loads with:
Inputs
- Current average order value: 48 $
- Average shipping cost per order: 7.5 $
- Proposed free shipping threshold: 60 $
- % of near-threshold customers who add items: 35 %
- Margin on items added to qualify: 9 $
- Orders per month near this range: 800
Results
- Net monthly margin impact: -$3,480
- Margin lift from upsizing: $2,520
- Shipping cost given away: $6,000
- Estimated new blended AOV: $52.20
What each field means
Inputs
- Current average order value ($)
- The current average order value used in the calculation, measured in $. Starts at 48 $ so you have a working example on load.
- Average shipping cost per order ($)
- The average shipping cost per order used in the calculation, measured in $. Starts at 7.5 $ so you have a working example on load.
- Proposed free shipping threshold ($)
- The proposed free shipping threshold used in the calculation, measured in $. Starts at 60 $ so you have a working example on load.
- % of near-threshold customers who add items (%)
- The % of near-threshold customers who add items used in the calculation, measured in %. Starts at 35 % so you have a working example on load. Accepted range: 0–100 %.
- Margin on items added to qualify ($)
- The margin on items added to qualify used in the calculation, measured in $. Starts at 9 $ so you have a working example on load.
- Orders per month near this range
- The orders per month near this range used in the calculation. Starts at 800 so you have a working example on load.
Results
- Net monthly margin impact
- Returned as a money amount in US dollars and shown as the headline result. It recalculates instantly whenever you change an input, so you can compare scenarios without reloading.
- Margin lift from upsizing
- Returned as a money amount in US dollars. It recalculates instantly whenever you change an input, so you can compare scenarios without reloading.
- Shipping cost given away
- Returned as a money amount in US dollars. It recalculates instantly whenever you change an input, so you can compare scenarios without reloading.
- Estimated new blended AOV
- Returned as a money amount in US dollars. It recalculates instantly whenever you change an input, so you can compare scenarios without reloading.
FAQ
Where should I set the threshold relative to AOV?
A common rule is 20-30% above your current AOV. Too close to current AOV gives away shipping on orders that would have happened anyway; too far above it and few customers bother reaching it, so the AOV lift never materializes.
Should the threshold change by season or promotion?
Yes, many retailers raise thresholds slightly during high-margin, high-demand periods and lower them during clearance or slow seasons to encourage volume. Just be consistent within any single campaign to avoid confusing repeat shoppers.
What if my current shipping is already free?
Then this calculation shifts to comparing a higher threshold that reduces overall shipping subsidy against the AOV lift a lower threshold currently provides. Model both threshold levels and compare net margin impact directly.
How accurate is the upsizing percentage assumption?
It varies widely by category and how close typical carts sit to the threshold; 25-45% is a reasonable starting range for stores where the threshold sits within striking distance of AOV. Validate with an A/B test or Shopify's cart analytics once live.
Accuracy and limitations
- Results are estimates before tax, fees, and inflation unless an input explicitly covers them.
- Rates are treated as fixed for the whole period — variable-rate products will drift from this projection.
- This is educational maths, not financial advice. Check anything contractual with the lender or your accountant.
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Cite this calculator
Writing about this topic? Grab a citation — every link helps keep these tools free.
RevenueLab. (2026). Free Shipping Threshold Calculator. Retrieved from https://www.revenuelab.fyi/toolbox/free-shipping-threshold
<p>Source: <a href="https://www.revenuelab.fyi/toolbox/free-shipping-threshold" target="_blank" rel="noopener">Free Shipping Threshold Calculator — RevenueLab</a> (2026).</p>
Source: [Free Shipping Threshold Calculator — RevenueLab](https://www.revenuelab.fyi/toolbox/free-shipping-threshold) (2026).