Retail · Furniture
Free assembly and delivery were bundled below cost on big ticket lines.
This marketing & margin audit surfaced $58k in recurring annual margin in a Retail business, evidenced, senior reviewed, and delivered in 6 days.
The business
A furniture retailer bundled free delivery and assembly into its big ticket lines as a selling point, on the assumption that the headline price comfortably absorbed the service. Large item sales were strong and the free service was a competitive differentiator, so the actual cost of delivering and assembling those orders was never rebuilt against the margin in the price.
What triggered the audit
Big ticket margin was thinner than the pricing implied, pointing at the bundled service rather than the product. The audit rebuilt the true cost of delivering and assembling large items, two person crews, vehicle time, failed deliveries and returns, and compared it against the margin baked into the headline price.
What the audit found
The free delivery and assembly were costing far more than the price absorbed. Large item fulfillment is genuinely expensive: two person crews, long vehicle routes, time on site to assemble, and a meaningful rate of failed deliveries and bulky returns that each carry their own cost. Bundled in free, this service was quietly eating much of the margin on the very big ticket orders the retailer promoted hardest, and on some lines it pushed the fully loaded order close to break even. Because the cost sat in a logistics line rather than against each order, and because the free service drove sales, the erosion was invisible. Rebuilt against the price, the undercosted delivery and assembly was worth roughly $58k a year in lost big ticket margin.
What we changed
Rebuilt the fully loaded cost of delivery and assembly per order and repriced the big ticket lines so the headline price genuinely absorbs it.
Introduced tiered or threshold based service pricing on the largest items, rather than bundling delivery and assembly free across the entire range.
Cut failed delivery and return rates with better scheduling and predelivery confirmation, reducing the expensive lifecycle cost at its source.
Made big ticket order margin, net of delivery and assembly, a monitored metric so the subsidy can’t silently return on flagship sales.
The result
The published chart shows margin on big ticket orders after delivery and assembly moving from −1% to +6%, a 7 percentage point increase. The cost build includes delivery, assembly, site time and failed delivery costs rather than treating the bundled service as free. $58k a year recovered by pricing big ticket delivery and assembly to what it actually costs, an annual figure equal to 10× the $5,950 Audit + Sprint fee. For any furniture or large item retailer, the free service is the leak: two person crews, site time and failed deliveries hide in a logistics line while the headline price looks healthy. If you bundle delivery and assembly free, your biggest orders may be your thinnest. A fixed fee audit rebuilds the true cost in days, so your flagship sales carry real margin again.
From kickoff to signed off findings: 6 days, inside our fixed 5–7 day window.
What the client said
$58k a year found in 6 days
Margin on big ticket orders, delivery in: −1% → +6%
“Free delivery and assembly were eating our biggest orders. David rebuilt the true cost with two person crews, vehicle time and failed deliveries, and some lines were near break even. Tiered service pricing on the largest items fixed it.”
David JacksonSenior Auditor · signed this audit off