Term

Minimum order value

Minimum order value is the smallest order amount you will accept for delivery, usually set per zone so small orders do not lose money.

Minimum order value (MOV) is the smallest order amount you will accept for delivery, usually set per delivery zone. A customer whose cart is below it is asked to add items before the order goes through. It is different from a free delivery threshold: the minimum is the floor for taking the order at all, while the threshold is the point where delivery becomes free.

Why it matters

A ₹90 order costs you the same to pack and deliver as a ₹400 one. Without a floor, a busy evening fills up with orders that lose money after rider and packaging costs and take kitchen time from orders that earn. A minimum also protects quality in rush hours, because each rider trip carries more value. The number should come from your own costs, and it should be higher for far zones where the rider trip costs more. What a 200 rupee order really costs to deliver shows the arithmetic most owners skip.

Example

A momo kitchen pays ₹30 per rider trip and ₹12 in packaging per order, and runs a gross margin of 55 percent. A ₹120 order leaves ₹66 of gross margin, minus ₹42 in delivery and packaging, so ₹24 before rent and salaries. At a ₹200 minimum the same order leaves ₹110 minus ₹42, or ₹68. The kitchen sets ₹200 for the near zone and ₹300 for the 5 to 8 km zone where the rider trip costs ₹55. Customers who were ordering one plate for ₹120 now add a drink or a second plate, and the orders that cannot reach the floor are the ones the kitchen is happy to lose. Pair the minimum with a free delivery threshold above it so there is a reason to go bigger still.