Detailed view
How this calculator works
The answer does not change between Quick and Detailed. This is the professional finance underneath it — the formula, assumptions and mechanics you can inspect when you want the extra detail.
Basic threshold — preserve today’s gross-profit dollars
First calculate the current product gross-margin rate: (average order value − product cost) ÷ average order value. The Basic threshold solves threshold × that margin rate − shipping cost = the gross-profit dollars in today’s average order. This assumes the product-cost percentage stays roughly the same as basket value changes.
Optional margin guardrail
If the owner adds a minimum post-shipping margin, calculate the threshold required to satisfy that target as well. The final threshold is the higher of the Basic profit-preservation threshold and the owner’s margin-guardrail threshold, so adding a guardrail cannot make the recommendation less conservative.
Rounding
The customer-facing threshold is rounded up to the next 5 units of local currency for a clean operating number. That rounding is a display convention, not an industry benchmark.
