How are shipping rates calculated?

How Addition Calculates Your Shipping Rates

At checkout, Shopify and Addition work together behind the scenes to calculate your shipping rates in real time.

Overview

When a customer checks out, Shopify sends Addition the details of their order. Addition then determines the best way to pack that order, applies Australia Post’s live rates, and returns the calculated total back to Shopify for display at checkout.

By default, Addition calculates shipping rates based on the dead weight of the cart and assumes BYO (bring your own) packaging.

This means if your product or packaging dimensions haven’t been added, Addition will quote rates purely by weight.

💡 Tip: For more accurate rates, record the dimensions of your most used packaging and the products you sell.

When Addition is fully configured to match how you actually ship orders, the app can make informed decisions on which package(s) to use and provide precise quotes based on the cart contents — including the quantity, weight, and size of each item.

Addition’s first priority is always to pack an order into the fewest parcels possible — ideally one — since multiple parcels usually increase total shipping costs.

Here’s How It Works

1. Shopify sends the order details to Addition

   This includes the customer’s shipping address, sender and destination postcodes, and product weights.

2. Addition retrieves your live Australia Post rates

   Depending on your setup in the Rates section, Addition connects to one or more of the following through the Australia Post API:

   • Retail (standard public rates)
   • MyPost Business (banded rates)
   • eParcel / Parcel Send (contract or corporate accounts)
   • StarTrack (express and freight services)
3. Addition checks weight limits
   • Each carrier has its own limits — for example:
   • Domestic parcels: 22 kg max
   • Flat-rate satchels: 5 kg max
   • Addition ensures the package configuration complies with these restrictions before requesting rates.

4. Addition calculates total dimensions and volume

   Using the product dimensions you’ve entered in the Addition app, it calculates the combined length × width × height and total cubic volume of the order.

5. Addition selects the best packaging option

   From your configured packaging list, Addition automatically chooses the most suitable satchel or box based on total volume and item dimensions.

   • If multiple options are available (e.g. small, medium, or large satchels, or custom boxes), the app picks the most cost-effective fit.
   • The app always prioritises fitting all items into one parcel wherever possible to keep costs low.

6. Determining the number of parcels

   If the total order volume exceeds your largest packaging option, Addition will split the order into two or more packages.

   Each parcel is rated individually, and the total cost is combined before sending back to Shopify.

7. Rate calculation

   Addition calculates shipping rates using:

   • Sender and customer postcodes — matched to Australia Post’s zone system (these differ between MyPost Business and Parcel Send).
   • Weight — both dead weight and cubic weight are assessed, with the higher value used as the chargeable weight.
   • Service type — e.g. Parcel Post, Express Post, International Standard, or StarTrack.

8. Returning the rate to Shopify

   Addition sends the final calculated rate to Shopify instantly for display at checkout.

   The app does not apply any markup or adjustment unless you’ve configured Custom Rate Modifiers (to increase or decrease rates by a set $ or %) or set up a Handling fee directly in Shopify.

Key Factors for Accurate Rates

To ensure rates display correctly and match Australia Post’s pricing, make sure the following are configured properly:

• Product weights are stored in Shopify (accurate to the nearest gram).
• Product dimensions are recorded in Addition.
• Packaging options are correctly set up in Addition (Shopify’s own packaging list is not used).
• Especially for international shipping, ensure that any boxes have an empty package weight set up in Addition, a box that weighs 400g alone makes a big difference
• Know that using Shopify Custom Profiles, can cause calculation issues

In Summary