Average order value calculator

How it works

AOV = revenue ÷ orders

gross profit per order =
  AOV × gross margin

after shipping =
  gross profit per order - shipping

extra order value that pays
for free shipping =
  shipping cost ÷ gross margin

What each term means

Revenue

Sales for the period on one fixed basis: with or without tax and shipping, before or after discounts and refunds.

Orders

Orders placed in the same period.

AOV

Revenue per order.

Gross profit per order

What the average order leaves after the cost of the goods, before shipping, payment fees and returns.

Shipping cost

What you pay to pick, pack and send one order.

Extra order value

How much a shopper at your average order has to add, at your margin, for the added gross profit to cover shipping you no longer charge for.

A free-shipping threshold without the guesswork

A threshold pays for itself only if the extra goods shoppers add earn at least the shipping you give away. At a 45% margin and €6 of shipping, a shopper has to add €13.33 of goods (€6 ÷ 45%) before free shipping costs you nothing.

Two things work against it. Orders that were already above the threshold get free shipping without adding anything, and a shopper who tops up by less than that costs you the difference. So set a threshold, then compare orders, AOV and gross profit per order before and after, rather than trusting a rule of thumb.

An average hides the spread

A few large orders pull an average up. If most orders are small, the typical order is lower than your AOV, and a threshold set just above the average can be out of reach for most shoppers.

Worked example

Example numbers, round on purpose. They are not a real store.

Revenue

€120,000

Orders

1,500

Gross margin

45%

Shipping cost per order

€6

1. 1AOV: €120,000 ÷ 1,500 = €80.00
2. 2Gross profit per order: €80.00 × 45% = €36.00
3. 3After shipping: €36.00 - €6.00 = €30.00
4. 4Extra order value that pays for free shipping: €6.00 ÷ 45% = €13.33

Frequently asked questions

• How do you calculate average order value?

  Divide revenue by the number of orders for the same period. €120,000 from 1,500 orders is an AOV of €80.00.
• Should AOV include shipping and tax?

  Either, as long as you keep one basis. Shopify's AOV uses gross sales minus discounts, without tax or shipping; GA4's average purchase revenue uses the value your tag sends with each purchase, minus refunds. Compare only figures built the same way.
• What is a good average order value?

  One your margins can live with. What matters is what an order leaves after the goods, the shipping and the ads that won it, so a store with a lower AOV and a higher margin can do better than one with a high AOV and a thin margin.
• How do I set a free-shipping threshold?

  Start from your margin, not from a percentage above your AOV. For free shipping to pay for itself, a shopper has to add the shipping cost divided by your gross margin in goods: €13.33 at €6 of shipping and a 45% margin. Set the threshold, then compare gross profit per order before and after.
• Why is my AOV different in GA4 and in Shopify?

  Each divides different revenue by different orders. Shopify uses gross sales minus discounts; GA4 uses the purchase value your tag sends, minus refunds, and it can miss orders, for example from visitors who decline analytics cookies.
• Does a higher AOV mean more profit?

  Only if the added goods earn more than they cost to sell. Bundles and thresholds that pull in low-margin items or discounts can lift AOV while the gross profit per order stays flat or falls.

Related terms: average order value, profit margin, conversion rate and purchase frequency.