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Calculate min spend for free shipping

  • 22-04-2011 12:21am
    #1
    iddy
    Closed Accounts Posts: 41 ✭


    Hi

    I'm trying to work the minimum purchase i require to allow me to offer free shipping and still make a profit assuming an average profit of 30% on orders and shipping costs of €20 per order.

    Any comments/ help appreciated.
    Thanks


Comments

  • #2
    meforever
    Registered Users, Registered Users 2 Posts: 94 ✭✭meforever


    In this case if it is a high volume export product you could advertise your product and include free shipping. In return you must add accordingly to cover all costs.


  • #3
    J_Wholesale
    Closed Accounts Posts: 245 ✭✭J_Wholesale


    €70.

    Assuming a profit of 30%, that brings in a profit of €21. Free shipping means you lose €20 of that, leaving you with the princely sum of €1. Question is, are you prepared to process and ship orders when your profit is only €1?

    And before you say it, yes, you will get orders for higher amounts. But once you introduce a free shipping threshold you will be amazed at the steps a portion of your customers will take to place an order for exactly €70 or €70.03.


  • #4
    MyAmber
    Closed Accounts Posts: 7 ✭MyAmber


    You could lower the amount you need by putting 2 or 3 leaflets inside your package.
    One day I bought a wireless router from Amazon and got it delivered with a leaflet of some broadband provider.
    You can approach some businesses that can benefit from your target customer group and not being your direct competitors.


  • #5
    maxer68
    Closed Accounts Posts: 1,076 ✭✭✭maxer68


    shipping costs seem quite high - can you negotiate these down and then it may make it easier to make it work.

    Or you can have free shipping on orders over a certain value.


  • #6
    HellFireClub
    Closed Accounts Posts: 3,912 ✭✭✭HellFireClub


    iddy wrote: »
    Hi

    I'm trying to work the minimum purchase i require to allow me to offer free shipping and still make a profit assuming an average profit of 30% on orders and shipping costs of €20 per order.

    Any comments/ help appreciated.
    Thanks

    Hi OP, You haven't mentioned what you are shipping or where you are shipping it to, but if you are paying any more than 10 Euro for a parcel under 25KG to be delivered nationwide in Ireland, I think you're paying way too much.

    If you are dealing in any volumes at all and are shipping within Ireland, (say 10 deliveries a day minimum), you should be able to negotiate somewhere between 5 and 10 Euro per delivery.


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  • #7
    iddy
    Closed Accounts Posts: 41 ✭iddy


    HellFireClub wrote: »
    Hi OP, You haven't mentioned what you are shipping or where you are shipping it to, but if you are paying any more than 10 Euro for a parcel under 25KG to be delivered nationwide in Ireland, I think you're paying way too much.

    If you are dealing in any volumes at all and are shipping within Ireland, (say 10 deliveries a day minimum), you should be able to negotiate somewhere between 5 and 10 Euro per delivery.


    Thanks for the comments. I'm shipping to Ireland and UK but often the parcels are bulky/oversized and over 25Kg so I'm just working on worst case so i will be covered when i offer free shipping.

    Thanks again


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