There are two options to choose from for this setting:
Ignore shipping costs
When this is enabled, the shipping costs are shared with the Collaborators at the same value as their percentage earnings.
For example, if a Collaborator earns 50% of a physical product of $10, they will earn $5 of that sale. If the shipping of that product was $10, they would also earn $5. They will earn the same percentage value for shipping as they are earning from the product.
Remove shipping costs per collaborator before revenue share takes place
When this is enabled, all shipping costs are deducted from the total before the calculations, and share takes place. This means that the store keeps all of the shipping amounts from the order to pay the fees.