# Free shipping threshold calculator

> Free shipping threshold calculator. Find the order value that pays for free shipping, and see what a threshold does to AOV, shipping cost and profit.

Free, no sign-up, runs in the browser: https://analify-ai.scalyax.ai/tools/free-shipping-threshold-calculator

Set free shipping where the extra order value pays for the shipping you absorb. See the threshold your margin supports and test any threshold against it.

## What it calculates

Free shipping above a threshold works when customers add enough to their basket that the extra margin covers the shipping you now pay. The suggested threshold is your AOV plus the extra order value needed to pay for one shipment. Testing a threshold shows the new AOV, the shipping you absorb and the net effect, based on the share of orders you expect to reach it.

## Formula

```
Suggested threshold = AOV + shipping ÷ margin (rounded up to 5)
AOV lift = (Threshold − AOV) × share reaching it
Shipping absorbed = Orders × share × shipping
Extra profit = Orders × AOV lift × margin
Net = Extra profit − shipping absorbed
```

## Worked example

Inputs:
- Current AOV: USD 55
- Shipping cost per order: USD 7
- Margin: 45%
- Orders per month: 1000
- Threshold to test: USD 75
- Orders that will reach it: 30%

Results:
- Suggested threshold: USD 75
- New average order value: USD 61
- Shipping you absorb: USD 2,100
- Extra gross profit: USD 2,700
- Net change per month: USD 600

## What changes the result

Orders that will reach it at five values; every other input as in the example.

| Orders that will reach it | New average order value | Net change per month |
| --- | --- | --- |
| 15% | USD 58 | USD 300 |
| 22.5% | USD 59.50 | USD 450 |
| 30% (example) | USD 61 | USD 600 |
| 37.5% | USD 62.50 | USD 750 |
| 45% | USD 64 | USD 900 |

## How to read the result

A threshold far above your AOV reaches few orders. A threshold close to it gives away shipping on orders that would have happened anyway.
The share reaching it is the number to test. Look at how many current orders already sit just under the threshold.

## Questions

**How do I set a free shipping threshold?**
Start at AOV + shipping cost ÷ margin. Below that, the extra basket does not pay for the shipping.

**Does free shipping increase AOV?**
It can, if enough customers add items to reach the threshold. Track the share of orders just above the threshold before and after.

**Should the threshold be above my average order value?**
Yes. Free shipping below your AOV gives it away on orders that would have happened anyway.

**Do you store what I enter?**
No. The calculation runs in your browser and nothing is sent to Analify.

## Use your real numbers

Analify reads order values from Shopify and shipping costs from connected couriers, and shows the shipping you charge against what you pay. Analify reads 5 of these 6 inputs live. Try the calculator: https://analify-ai.scalyax.ai/tools/free-shipping-threshold-calculator

More free ecommerce calculators: https://analify-ai.scalyax.ai/tools