Biggest loss
Shipping gap: about $400 a month
Each order costs about $7.00 to ship and the buyer pays $5.00, so about $2.00 an order goes missing. At your numbers, that's about $400 a month.
- Per order
- −$2
- A month
- −$400
- A year
- −$4,800
The fix
Raise prices by about $2.06 an order and keep shipping as buyers see it now. If orders hold, you'd keep about $400 more a month.
+$400a month, if orders hold
Risk: Orders could fall by about 9% (about 1 in 11) before this fix leaves you worse off. A higher price can lose orders. 39% of shoppers who abandon a checkout cite extra costs such as shipping (Baymard), so a price buyers see up front is often the safer place for it.
Or: Charge what shipping costs
Charge about $7.00 for shipping, what it costs you. Card fees apply to shipping too, so if orders hold you'd keep about $389 more a month.
Orders could fall by about 9% (about 1 in 11) before this fix leaves you worse off. 39% of shoppers who abandon a checkout cite extra costs such as shipping (Baymard), so a higher shipping charge can lose more orders than the same money in the price.
How we worked it out
gap per order = share free × (label + packaging) + (1 − share free) × max(0, label + packaging − shipping charged) = $2.00; monthly = gap × orders = $2.00 × 200 = $400.00
price rise = gap ÷ kept per extra dollar = $2.00 ÷ 0.973 = $2.06; value = gap × orders = $2.00 × 200 = $400.00; orders can fall by 1 − π ÷ (π + gain) = 1 − $19.62 ÷ $21.62 = 9.3%
Basic stores can't use carrier-calculated rates from third-party carriers; they come with Advanced and cost extra on the middle plan's monthly billing (Shopify Help, older plan names). 39% of shoppers who abandon a checkout cite extra costs such as shipping (Baymard).