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Drop Ship Cost Comparison Calculator

Work out drop ship cost comparison instantly with clear inputs, formula shown and shareable results.

About Drop Ship Cost Comparison Calculator

Comparing drop shipping with in-house fulfilment requires the in-house figure to include the inventory holding cost that drop shipping avoids entirely. Excluding it makes in-house look cheaper than it is, since a warehouse's real cost is stock as much as labour.

Formulas

In-house cost

In-house = Pick, pack and ship cost + Attributable inventory holding cost

Advantage

Advantage = In-house cost - Drop-ship fee

Worked example

With the default values below, Drop Ship Cost Comparison Calculator returns Cost advantage of drop shipping of $320.00. Change any input above and every figure here is recalculated in your browser.

Inputs used

Average order value
8,400
Drop-ship fee per order
420
In-house pick, pack and ship cost per order
560
Inventory holding cost attributable per order
180

Results

Cost advantage of drop shipping
$320.00
Drop-ship cost per order
$420.00
In-house fulfilment cost per order
$740.00
Drop-ship fee as % of order value
5.000%

Step by step

  1. 1Values used
  2. 2In-house cost
  3. 3Advantage
  4. 4Cost advantage of drop shipping= 320.00
  5. 5Drop-ship cost per order= 420.00
  6. 6In-house fulfilment cost per order= 740.00
  7. 7Drop-ship fee as % of order value= 5.000

Assumptions and limits

  • The result is derived only from the 4 inputs listed above. Anything not among them is not part of the calculation.
  • In particular, this calculator does not take inflation, tax or compounding frequency into account.
  • Figures are rounded for display to 3 decimal places, so totals built from several rounded parts can differ slightly from the unrounded arithmetic.

How these calculators are built and tested is described on the Methodology page. If a figure looks wrong, please report it.

Frequently Asked Questions

What are the non-cost trade-offs?

Loss of control over packaging, delivery experience and returns, plus reduced ability to consolidate multi-line orders into one parcel.

When does drop shipping clearly win?

For bulky, slow-moving or high-variety items where holding stock is expensive and demand is hard to forecast.

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