Discount calculator: how many more sales you need

A discount comes straight out of your profit, not your price: a 20% discount on an item with a 40% margin halves the profit on each sale, so you need twice as many sales to earn the same. The smaller your margin, the more a discount costs you.

How it is worked out

• Profit per sale now = price − cost
• Profit per sale with the discount = price × (1 − discount) − cost
• More sales needed = profit now ÷ profit with the discount − 1

When a discount pays

A discount pays when it brings sales you would not otherwise have — new customers, a larger order, clearing stock you would otherwise hold. Limit it to the products, customers or order sizes where it does that: a minimum order amount, a first-order code, or a "buy two, get one" deal that raises the order value instead of cutting the price of every sale.