Ever wonder how companies decide how much you need to spend? Yet free shipping? Well, I can’t speak for all businesses, but I can tell you how I do it. First thing to know is that shipping is never really free. It just means that the business is paying for it. So the first thing I look at is what it costs me on average to ship an order. In my case, it’s about $9 to send an order from where we are in Canada to a customer in the US. Then I have to figure out how much a customer has to spend for it to make financial sense to absorb $9 in shipping costs. I also have to factor in that they might not be buying at full price. Either they might be using a coupon code or by during a sale. So the number I come up with needs to work in those scenarios too. Otherwise, the cost can balloon out of control really quickly.
Ask me how I know about that one. So at the moment, I’ve settled on $50 for free shipping at the end of the day, though, all I can do is my best. The customer is the one that gets to decide if it’s worth it for them. I just have to make sure that I don’t stretch further than I realistically can.