Pricing Strategies to Consider For a Free Shipping Guarantee: Calculated Shipping

If you set up a free shipping guarantee, orders $35 and over ship for free for buyers in the US.

Offering free shipping doesn’t have to cost your shop money. While free shipping for buyers isn’t free for you, the seller, you can recover the cost of shipping by adjusting your item prices. It’s up to you to decide if repricing your items to recover shipping costs is right for your business. 

If you’re a seller in the US or Canada, you may be using calculated shipping for your shipping prices. If you’re a US seller, you can use our smart pricing tool if you want to reprice your items for a free shipping guarantee. 

If you’re a Canadian seller, read these strategies you can consider to recover shipping costs when you offer a free shipping guarantee.

If you use fixed shipping prices, read these learn strategies you can consider to recover shipping costs when you offer a free shipping guarantee.

Strategies to reprice items if you use calculated shipping

If you’re a Canadian seller and you use calculated shipping, there are a few things you can consider when determining how to recover shipping costs when you offer a US free shipping guarantee.

Since calculated shipping bases the shipping price charged to buyers on their location, you’ll need to decide which group of buyers to price for. Your items prices don’t change depending on where your buyers are located. You can choose to update your items over $35 USD, or all your items.

Here are some ways to determine how much to adjust your item prices by to recover shipping costs when you use calculated shipping:

  1. Determine your average shipping distance
  2. Check your average shipping price to that location
  3. Check your handling fee

Once you decide if you’d like to update your item prices and if so, by how much, you can edit your item prices and update your shipping costs to countries that are not the US.

Determine your average shipping distance

Since calculated shipping uses your buyer’s location to determine the shipping price they’re charged, to recover shipping costs, you can choose an average buyer, and base your item price adjustments on them.

Decide if you want to base your price updates on shipping cost to the US or Canada. In general, you’ll recover shipping costs more accurately if you price for wherever you get the most orders from.

Then check where you generally ship orders within that country.

For example: Your orders come from Canada,and you’re based in Montreal. A majority of your orders come from within Quebec. Consider using your average shipping cost to Quebec to adjust your item prices to recover shipping costs.

Check your average shipping price to that location

You can use Etsy's Price Your Postage calculator to check your average shipping costs to the location you chose. Enter the location you chose to base your price adjustments on into the calculator, as well as the typical size of packages you ship.

The resulting shipping price is an amount you can use to base your price adjustments on to help recover shipping costs when you offer a free shipping guarantee. How you use this number and price your items is up to you.

Check your listed handling fee

With calculated shipping, you have the option to charge a handling fee. You may want to take your handling fee into account when determining your item prices.

To find your handling fee:

  1. In Shop Manager, click Settings.
  2. Click Shipping settings.
  3. Click Edit next to a shipping profile. 
  4. Note how much you were charging for handling next to Handling fee.

Consider if you’d like to add your handling fee to the amount by which you want to adjust your item prices to recover costs.

How to update your item prices

To update your item list prices to include shipping price:

  1. In Shop Manager, click Listings.
  2. If you want to edit all your listings, click the checkbox at the top left. If you want to edit some listings, select the checkboxes under those listings.
  3. Click Editing options.
  4. Click Edit prices.
  5. Enter the amount you used to charge for shipping, or whatever amount you decide, next to Increase prices by or Decrease prices by. You can see a sample listing, with its current price and its updated price.
  6. Click Apply. This will update the list prices of all your selected listings by this amount.

To qualify to have a free shipping guarantee for your shop, you only need to offer free shipping on items and order totaling $35 USD or more for buyers in the US.

How to update shipping prices to other countries

If you choose to adjust your item prices to recover shipping costs when you offer a US free shipping guarantee, consider updating your non-US shipping prices to minimize any difference in total order cost that shoppers in these countries would pay now compaired to what they paid before.

Since you use calculated shipping, you have a few options, including:

  • Offer free shipping domestically and/or internationally
  • Change to using fixed shipping prices either domestically or internationally

If you’d like to offer free shipping either domestically or internationally:

  1. In Shop Manager, click Settings.
  2. Click Shipping settings.
  3. Click Edit next the shipping profile(s) you want to update. You can repeat this step for each calculated shipping profile you use.
  4. Check the box next to Free domestic shipping, Free international shipping, or both.
  5. If you included your handling fee in your item price adjustments, you may want to change your Handling fee to 0.00.
  6. Click Save profile.
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