Set it from your own orders: a little above the typical order, where the profit on the item a shopper adds covers the postage. Then show it beside prices and in the cart.

The number on the banner

Free shipping on orders over $50. Plenty of small online stores carry a line like that across the top of every page, and most of those numbers were chosen in about a minute.

Someone saw a competitor offer it, or liked a round figure that sounded generous, and nobody checked it against the store's own orders.

A threshold picked that way can fail in two directions. Too low, and the store pays postage on orders that were coming anyway. Too high, and nobody reaches it.

The right number comes out of the store's own figures, and finding it takes an afternoon.

What a threshold is for

A threshold has one job: to turn an order that was going to be small into one that is a little larger.

A shopper with one item in the cart sees free shipping a short step away and adds a second. The profit on that second item pays the postage the store now covers.

Everything else the offer does is a cost: a shopper already spending past the line gets free shipping for doing nothing different.

The figures to gather

The last is the one most stores skip, and it is the real price of the offer. Every one of those orders would have paid its own shipping, and now will not.

Finding the typical order

Sort a year of orders by value and look at the one halfway down the list. That middle order is a truer picture of a normal customer than the average.

A few large orders, such as a company buying staff gifts, drag the average well above what a normal customer spends.

Then look for bunches. Orders in most small stores cluster around a few amounts: one item, two items, a standard gift box. A threshold just above a bunch asks those customers to add one thing.

What shipping actually costs you

The postage on the label is only part of it. Boxes, padding, tape and the time spent packing all belong in the figure.

Distance and weight change it most. A parcel to a remote northern community can cost several times as much as the same parcel to the next town.

Glass, liquids and hardware cost far more to send than their prices suggest. Weigh a few real packed orders and price them to three or four regions rather than guessing.

The arithmetic

The first test is short. At the threshold you are considering, does the profit on the item a shopper adds cover the postage you will now pay?

The second test is the expensive one. Count the orders already above that line and add up what free shipping on each of them would have cost over the year.

A threshold passes when the profit from customers who add an item comfortably exceeds the postage given away to those who would have spent that much regardless.

A worked example

A small jam and preserves maker in the Fraser Valley sells its jars at farmers' markets and through an online store that ships across Canada.

Its banner promised free shipping over $25, a figure the owner had seen on a larger store's site. Three jars passed it, and three jars was the most common online order.

Glass is heavy and needs careful packing. A box of three sent to Ontario cost the business more than the profit on the jam inside, so the most common order lost money.

The owner sorted a year of orders, weighed packed boxes, priced them to each region and worked out the profit per jar.

The new rule is a flat rate within Canada, with free shipping from the price of a six-jar gift box. Product pages say so beside the price, and the cart shows how many more jars would reach it.

Every order now covers its postage: three jars through the flat rate, six through the profit on the box.

Where shoppers see it

A threshold nobody notices changes nothing. It has to be in front of the shopper at the moment they decide how much to buy.

That moment comes on the product page, beside the price and the button, and again in the cart, where a line saying how far the order is from free shipping turns the offer into a simple choice.

A slim line across the top of each page helps too. Word it the same everywhere: over $60 on product pages and over $50 in a forgotten banner sends people to checkout expecting a gift.

Limits, said plainly

Most stores need limits: very heavy items, orders to the territories, anything bound for the United States. Limits are fine. Hidden ones are not.

Put them in the same line as the offer, such as free shipping over $60 within Canada, so nobody discovers them at checkout.

Most store platforms, including Shopify and WooCommerce, can apply free shipping above an order amount and restrict it to chosen regions, so the rule on the page and the rule at checkout match exactly.

The counter-case

A threshold is not the only answer, and for some stores it is the wrong one.

A store whose orders are nearly always one item, such as furniture, has no second item to nudge towards. A flat rate, or postage built into the price, is simpler there.

A store selling mostly to nearby customers may do better with free local pickup than any national threshold, and a new store may need a cautious figure until it has a year of orders to sort.

For everyone else, set it from your own orders, just past the typical basket, and show it where people decide.

This afternoon

  1. Export a year of orders from the store.
  2. Find the middle order value, not the average.
  3. Weigh real packed boxes and price each region.
  4. Count the orders already above your current threshold.
  5. Check the added item's profit covers the postage.
  6. Show the threshold beside prices and in the cart.
  7. Redo the sums whenever postage prices change.

Step four decides which way the threshold should move. If many orders already clear it, the line is paying postage for customers who needed no nudge; if almost none do, it is too high to change anything.

A threshold only helps if the extra item is actually there to ship, which is covered in out-of-stock products still for sale.

Frequently asked questions

How should I set a free shipping threshold?

From your own orders: find the typical order value, work out what shipping really costs, and set the line just above the usual basket.

Why not use the average order value?

A few large orders, such as a company buying staff gifts, pull the average upward. The order halfway down a sorted list is a truer picture of a normal customer.

What does a threshold set too low cost?

Postage on every order that was already above the line. Those customers would have spent that much anyway, so the store pays their shipping and gets nothing in return.

What happens if the threshold is too high?

Almost nobody reaches it, so it changes nothing. It sits on the banner as decoration while customers keep paying shipping exactly as they did before.

Where should the threshold be shown?

Beside the price on every product page, in the cart with how far the order is from it, and in a slim line across the top of each page.

Can I exclude heavy items or remote areas?

Yes, and most stores need to. Say so in the same line as the offer, so the rule shoppers read matches the rule applied at checkout.

West Coast Media Solutions Inc. provides web design, web development, hosting, digital marketing, and business consulting to organisations across Canada, drawing on more than twenty-five years in the field.

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