This Shopify shipping calculator takes three numbers and returns two: the order value at which free shipping stops costing you money, and a flat rate that covers a typical label. Runs in your browser. Nothing is stored or sent anywhere.
Free-Shipping Threshold Calculator
A planning starting point; test the threshold against your own checkout conversion.
Forvendo · every other Friday
One operating decision, worked through with numbers
The same approach this calculator takes: the sources named, the assumptions shown, and the arithmetic left where you can check it.
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What this Shopify shipping calculator is doing
Free shipping is a discount. The question is not whether to offer it but at what order value the discount is smaller than the margin it unlocks.
The calculator takes two inputs:
- Average order value (AOV) — from Shopify admin, Analytics → Reports → Average order value. Use the last 90 days, not lifetime.
- Median label cost — what you actually pay per outbound package, averaged across your real mix of destinations and weights.
It returns a starting threshold at about 1.5× your AOV, and a flat rate near your median label. That multiplier is a starting point, not a derived optimum: it puts the threshold far enough above AOV that free shipping is something a customer reaches for rather than something most orders get by default.
Then check it against your margin, which the calculator does not do for you. Take your gross margin percentage — revenue minus cost of goods, divided by revenue — and multiply it by the suggested threshold. If that figure does not clear your median label with room left, the threshold is too low for your margin and you should raise it until it does.
Why the number is usually higher than operators expect
A store with a $48 AOV, 55% gross margin, and a $9.20 average label is carrying $26.40 of margin per order against a $9.20 cost. That looks comfortable until you account for the orders that sit below AOV, the returns that pay shipping twice, and the fact that a free-shipping banner pulls order values down toward the threshold rather than up toward it.
Setting the threshold at AOV is the most common mistake. It gives away shipping on roughly half of orders while moving almost nobody upward.
The flat rate matters more than the threshold
Most of the decision lives in what you charge when the order is below the threshold. A flat rate that undercuts your label cost turns every small order into a loss. A flat rate far above it suppresses small orders entirely, which may be what you want if small orders are unprofitable after pick, pack, and support time.
The calculator returns a flat rate that covers a typical label. Whether you round it up to discourage small orders, or down to buy volume, is a positioning decision the calculator does not make for you.
What this does not cover
- Carrier-calculated rates. If you show live carrier rates at checkout, your shipping revenue moves with each order and a single flat rate does not apply. Shopify documents the available rate types in Shipping rates.
- Multi-item orders with weight breaks. The model uses one typical label cost. Stores with wide weight variance should run it separately per product tier.
- International. Duties and longer zones change the arithmetic enough that a domestic threshold does not transfer.
Related
- Shopify Shipping Rates: A Margin-First Decision System — the full method, including how to test a threshold change without wrecking a quarter
- All free calculators
- Free spreadsheets and templates
Frequently asked questions
What should my free shipping threshold be on Shopify?
It depends on your average order value, gross margin, and label cost, which is what the calculator combines. As a shape: the threshold generally sits meaningfully above AOV, because a threshold at or below AOV gives shipping away on orders that would have converted anyway.
Does Shopify have a built-in shipping calculator?
Shopify can show carrier-calculated rates to customers at checkout, and its admin can estimate label costs when you buy postage. Neither one tells you where to set a free-shipping threshold against your own margin. That is the gap this calculator fills.
Should I offer free shipping at all?
Not automatically. Free shipping is a margin decision, not a hygiene factor. If your gross margin cannot cover a label at a realistic order value, a clear flat rate is usually the better position, and it can be reviewed each quarter as costs change.
Are my numbers saved anywhere?
No. The calculator runs entirely in your browser. Your inputs stay on your device and are remembered locally only so the figures are still there next visit.