A free delivery threshold is the minimum basket value at which an online shop stops charging for delivery, for example “free UK delivery on orders over £40”. Below the threshold the customer pays a delivery charge; at or above it, delivery is free to them and the shop absorbs the cost.
How a free delivery threshold works
The threshold relies on a simple habit: many shoppers would rather add another item than pay for postage. Someone with £32 in their basket and a £40 threshold will often look for something around £8 to £12 to qualify. That is why shops usually set the threshold a little above their typical order and show a progress message in the basket, such as “Spend £8 more for free delivery”.
The cost does not disappear. If a parcel costs you £4 to send, every order over the threshold carries that £4 out of your margin. The threshold earns its keep when the extra items people add, plus the orders that would otherwise have been abandoned, bring in more gross margin than the delivery you give away.
Thresholds often vary by service and destination. A shop might offer free standard delivery over £40 but always charge for next-day or named-day delivery, or set different terms for Northern Ireland, the Scottish Highlands and Islands, or bulky items that need a two-person courier.
Why it matters for a UK business
Unexpected delivery costs come up again and again in checkout research as a reason people abandon a purchase, so the way you handle delivery feeds straight into your cart abandonment rate. A clear threshold, stated early, sets expectations long before the shopper reaches checkout.
It is also one of the most direct tools for lifting average order value, which matters because acquisition costs are paid per order, not per pound. Raising the typical basket from £35 to £45 makes every pound spent on ads work harder.
Delivery terms appear in your advertising too. Google Shopping ads and free listings can show delivery costs and free delivery messages, taken from your Merchant Center delivery settings or the shipping attribute in your feed. Accurate settings make listings more competitive and avoid disapprovals for mismatched costs.
There are presentation rules as well. Under UK consumer law and the CAP Code, a “free delivery” claim must be genuine and its conditions clear, and delivery charges must not be sprung on shoppers at the last step. The Digital Markets, Competition and Consumers Act 2024 tightened the rules on hidden charges, so at the time of writing (October 2026) it is worth checking the CMA’s current guidance on how delivery costs should be shown alongside prices.
Common mistakes
- Setting the threshold too high. A threshold far above your typical order feels out of reach, so people pay the charge or leave rather than add items.
- Setting it too low. If most orders already qualify, you pay for delivery without changing anyone’s behaviour.
- Hiding it. A threshold mentioned only at checkout does nothing to shape what people add earlier.
- Offering no sensible add-ons. If your cheapest product is £25, a shopper £6 short has nothing reasonable to add.
- Ignoring weight and size. Free delivery on heavy or bulky items can turn profitable orders into losses.
How to act on it
Export three to six months of orders and look at how basket values are spread, not just the average. As a working rule of thumb, rather than a benchmark, I start by testing a threshold somewhere between 15% and 30% above the median order. Work out what each delivery really costs you, then model how many extra items or orders the threshold needs to generate to cover what you give away.
Show the threshold in the site header, on product pages and in the basket with a live progress message, and make sure there are useful lower-priced products to suggest when someone is close. Then test it: run one threshold for several weeks, compare margin per order and conversion rate, and adjust. If you can split traffic, a proper A/B test gives a cleaner answer.
Delivery offers are one part of how an online shop is sold. I look at them alongside ads, search and on-site conversion in my work on digital marketing for ecommerce and retail.