Price the product, then price the delivery

Free shipping is a margin decision disguised as a marketing one. A worked example with real courier rates.

Free shipping is a margin decision

Offering free delivery does not make delivery free. It moves the cost from a line the customer sees to one they do not, and it comes out of the same margin either way.

That can be exactly the right call — a clean price converts better and removes a moment of hesitation at checkout. But it is a pricing decision, and it needs to be made with the courier's rate card open, not as a marketing reflex.

Work it backwards

Start from what you need to keep per order. Add the cost of getting it there, then the cost of a proportion of orders coming back, because some will. What is left is the number your price has to clear.

The return rate is the part people forget. If a meaningful share of orders are refused, every successful order is quietly carrying the cost of the ones that were not.

Thresholds beat blanket offers

Free delivery above a certain basket size does two useful things at once: it protects the margin on small orders, and it gives the customer a reason to add one more item.

Set the threshold just above your current average order, not far above it. A target nobody reaches is not an offer, it is a decoration.

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