Facing Higher Costs, Some Brands Are Making Changes To Shipping Charges

Feather & Bone’s shipping costs have surged 20% to 40% over last two years. While the skincare brand known for Face Gems cleansers priced from $8.99 to $30 has kept a relatively low threshold of $20 for free shipping on its website, CEO and founder Shubhangini Prakash has been thinking of raising the free shipping threshold to $25 to $30 to help it absorb the cost increases. She’s weighing her decision in an environment where big companies like Amazon have made free shipping largely expected by consumers.

Sharing her considerations, Prakash says, “I am not as worried about increasing the threshold to $30 as the product line grows because there is enough choice of products for people to choose from. Also, because people coming to our brand understand the value of our products, I don’t suspect it will lead to too much cart abandonment. Further, in general, our average cart value is much higher than the free shipping threshold, even after the increase, so I don’t see the increase having a major impact. One thing I am figuring out is how the increased threshold will affect our subscription products.”

Prakash was curious whether other beauty brands have been deliberating over pushing up their free shipping threshold or adding shipping fees. Prompted by her curiosity, for the latest edition of our ongoing series posing questions relevant to indie beauty, we asked 19 beauty entrepreneurs and executives the following questions: Do you offer free shipping and/or have you made any changes to what you do for shipping such as the threshold at which a customer can get free shipping? What’s the reasoning behind your shipping fees or lack thereof?

As a result of increases in our shipping costs over the past three years, we made some changes to our policies earlier this year. We increased the threshold for free shipping on our online orders from $45 to $75.

While this may seem like a significant jump, our AOV is about $89, so most of our customers should not be impacted. We also increased our shipping fee from $7.99 to $9.99. We have, however, also been more proactive in our free shipping promotions, which are very successful. We have not made any changes to our wholesale shipping standards.

Nancy Schnoll Founder and CCO, Reflekt

After previously offering free shipping on all orders, we raised the threshold for this benefit to orders over $50. Initially we did this because, as a small but mighty business with only four products in our skincare regimen, we couldn’t absorb the cost to ship smaller orders for no fee.

We have since found that this free shipping minimum encourages customers to place fewer small orders (individual products) and more large orders (multiple products), which also helps our sustainability efforts, a win-win!

Vered Back Founder, Vered Organic Botanicals

Despite the challenges linked to the shopping costs going up substantially, I have taken the decision not to raise them for my customers. I offer free shipping to orders in the U.S. that are above $100, and I charge a $25 flat fee for international orders.

The reality is that it costs me more in shipping fees than what I charge my customers. Customers tend to be deterred from ordering if shipping fees increase, even if they have been loyal and supportive of a brand over the years. There's a fair balance to maintain.

This is also why I am connecting with specific, targeted retail partners to improve the shopping experience of my customers. For my Canadian customers, for instance, buying my products via The Green Jungle Beauty Shop solves the shipping issues, and everybody is content and satisfied in the process.

Melinda Williams-Smith Founder, Face Front Skin

In 2021, I actually had to discontinue my free shipping policy due to a 200% increase in shipping rates. In 2018, the average cost for a 5-pound box, depending on the state and shipping provider, was $5 to $10. Now, it’s $18 to $30.

Today, I offer a flat rate of $8 to at least take the pressure off and cover shipping supplies. I do offer free shipping on all orders over $100. My abandoned cart rate has not changed. However, I do offer a deal to bring customers back.

Priscilla Jiminian Founder and CEO, Skinergy Beauty

We offer free shipping for orders over $75. With our current prices, it is easy to reach that number, as our AOV ranges between $70 and $120. When carriers such as USPS and UPS raise shipping costs, we follow suit, but only if it is necessary. Most of the time, it is only a few cents to a couple of dollars difference.

I like to think of how I personally shop and how shipping prices deter me from placing an order. With this in mind, I try to keep shipping prices reasonable for our customers. Another option is giving them the choice to pay for first class (slower, but cheaper), priority or express.

So far, no complaints from our customers. A good idea is to keep shipping a tad higher than the going rates from carriers. That way, when they hike up their pricing, you won’t have to.

Tai Adaya Founder, Habit

We offer free shipping for orders over $50 and subscription orders. We didn't increase prices across the board last year due to inflation. It didn't feel right to make sunscreen less accessible during a downturn.

But we needed some way to cover the rising costs of shipping and labor, so we went with charging incremental shipping on orders under $50 versus raising prices across the board.

Strategically, charging for shipping on orders under $50 on our owned channel also pushes customers to Sephora (where shipping is free if a customer is part of Sephora Beauty Insider, VIB or Rouge).

I think it's important to craft pricing structures that balance transparency and feeling good. Most customers understand that an online purchase has shipping and fulfillment costs, even if those costs are not explicitly broken out.

Bernadette Finnerty Founder, Shavestix

We started with free shipping on day one. The obvious intention was to eliminate barriers to ordering, especially with a new product.

But, with significant increases in postage over the last several months, combined with the fact that most of our customers order more than one Shavestix at a time, we are considering changing our policy.

Specifically, we may add a free shipping threshold, something like, “Order two or more Shavestix and get free shipping.” I’m still thinking through this, but it’s something we need to consider.

Karen Albors Founder, Sauca Botanicals

As a Puerto Rican beauty brand, manufacturing cost is higher than in the States. Therefore, offering free shipping on all products is a more difficult issue. Retail prices would need to increase too much or we would need to set a very high minimum purchase for it to cover the full shipping expense.

We constantly offer free shipping discounts to our subscribers as an exclusive perk. Sometimes, we set a $100 minimum purchase to motivate higher purchases, and sometimes we do no minimum purchase to encourage new customers or abandoned carts.

Puerto Rico has a 11.5% sales tax, so I am very mindful of what local people end up paying for my products. For me, offering shipping incentives is equivalent to giving a price discount. I usually evaluate my business’s monthly goals and decide what type of discount I can afford to give.

Kyra Venable Founder, Lavender Meadows Co

I currently offer free shipping with orders $60 or more. Orders under $60 pay $6 in shipping. Shipping can be tricky to account for when you price your products. If you account for the cost of shipping when you price each product, then your customer can end up paying an exorbitant amount extra when they purchase several items.

Instead, I budget about $2 shipping into the cost of each product. That way, when a customer places an order that is over $60 which qualifies for free shipping, I am not left bearing the shipping cost.

When a customer places an order for two items, they will pay the $6 shipping fee. Two items mean four extra dollars so I can pay for the total $10 shipping fee. Everything seems to average out well when I do it this way.

Abena Boamah-Acheampong Founder, Hanahana Beauty

We don't offer free shipping unless it is a sale. [Shipping is, for example, roughly $4 to $10 on a shea butter product purchase.] We're a small growing startup, so being mindful of costs such as shipping can have a large impact.

Ajish Morris

COO, Invity

We have reviewed the situation and have not made any changes to shipping fees. We continue to offer free shipping in the U.S., and for international shipping, we offer free shipping for orders above $120 and charge a nominal $15 as shipping fee for orders below $120.

Allison McNamara Founder, Mara

Shipping costs and fulfillment fees have skyrocketed over the past three years. We offer free shipping for U.S. domestic orders over $80. As a brand, we have not done any price increases since our inception, and we have not raised the threshold for free shipping.

Our reasoning for $80-plus for free shipping is that the customer at that price has either purchased one of our higher priced items or purchased a combination of two products on the website.

Monique Kaminski Founder and CEO, Jeuneora

In New Zealand, shipping is free for any orders over $40. We increased the free shipping threshold to $70 from $40 in Australia and to $100 from $75 for the rest of world, with the exception of the UAE, which was increased to $200 from $75. Being so far from so many countries isn't ideal!

Jeremy Gardner Founder and CEO, MadeMan

We offer free shipping on all products except for our free trial, which is offered once per customer but costs $4.99 in shipping. We would rather deliver more value to customers and create a better customer experience than have them pay for shipping. Especially with subscription products and given the fact that we are trying to destigmatize men's skincare, we want the MadeMan experience to be as smooth as possible.

Lauren Fleming CEO, The Factor Formula

At The Factor Formula, we do offer free shipping and have historically kept it at the set price of orders $75 or more, which is probably more on the high end.

One of the best pieces of advice we received was never apologize for your price point and give yourself the cushion to make the best choices for the customer and business. It is much easier to come down from a higher price point then explain why prices must go up down the line.

Using this advice in setting shipping policies and price points has not only helped us retain quality, but also helped us in setting a clear expectation about what buyers can expect from The Factor Formula.

Meerika Khanna Founder, Rthvi

Our shipping policy is an integral part of our overall business strategy. By offering free standard shipping for orders over $45, we aim to provide added value to our customers and encourage them to purchase more products. This not only increases the average order value, but also helps to build customer loyalty.

We believe that it is important to consider the impact of any changes to our shipping fees and threshold on our customers and our business as a whole. While the rise in shipping and material prices is a concern, we are currently trying to minimize any changes to our shipping policy and will only consider adjusting it when the time is right.

Our ultimate goal is to provide the best possible customer experience while also ensuring the long-term sustainability and profitability of our business.

Samantha Brett Founder and CEO, Naked Sundays

No one like high shipping costs, especially the consumer! They’d rather not buy the product then having to pay high shipping costs. But, unfortunately for many brands, they have no choice in the matter. We do charge shipping, but the threshold is quite low, and our average order value is quite high.

We offer free shipping within the continental U.S. for orders over $50, which takes five to eight business days after the orders are placed. Express shipping within the continental U.S. is $14.95, subject to shipping and handling time. For orders under $50, we offer a flat standard shipping rate of $6.95.

That’s the key to making it work, making sure you have enough extra products, bundles or add-ons that make it worthwhile for the brand to offer free shipping to the customer.

Raquel Bouris Founder, Who Is Elijah

We do offer free standard shipping and offer express shipping for a fee. We found that, when our shipping was free, our sales were notably higher. This happened by mistake when our website glitched and made all shipping free.

We tested it for a few days, then switched back to paid shipping, and sales dropped immediately. We believe that we would rather cover the cost of shipping and be able to successfully reach more people by offering free shipping.

Vanessa Faddoul Founder and CEO, Ahimsa

At Ahimsa, we offer free shipping for all orders, regardless of order size. We implemented this to eliminate any barriers for consumers to try our products and become part of our brand community.

If you have a question you’d like Beauty Independent to ask beauty entrepreneurs and executives, please send it to editor@beautyindependent.com.