Discount calculator: how much to give without losing margin

How to use the calculator

1. Choose the promotion type: a discount on one product, “buy X, pay for Y” or a tiered discount.
2. Enter the price and the discount (in % or amount), or the tiers if it is tiered.
3. To see the margin, enter the product cost and, if any, the fees and taxes on the sale.
4. Enter the minimum margin you want to keep to see the maximum discount and which tiers fall below it.

The math behind the result

• Final price = price × (1 − discount).
• Gross margin = (price − cost) ÷ price.
• With fees and taxes (t, as a % of the sale price): profit = price × (1 − t) − cost, and margin = profit ÷ price.
• Maximum discount to keep margin m: minimum price = cost ÷ (1 − t − m); the maximum discount is the gap between the full price and that minimum.

An example

A product priced at 100 that costs 60 has a gross margin of 40%. With a 10% discount the price drops to 90 and the margin to 33.3%. To keep a 30% margin, the maximum discount is 14.3%: above that, the margin falls below what you set.

Is “buy 3, pay for 2” a 33% discount?

Only when all three products have the same price. With different prices, the free item is the cheapest one, so the real discount is below 33%. The calculator does this math and shows the real discount of the bundle.

Tiered discount

You define tiers (for example, 5% from 2 units, 10% from 3) and the table shows the price per unit, total, savings and margin for each quantity. Rows that fall below the minimum margin are flagged.

What the calculator does not do

• It does not include shipping, installment interest or specific tax rules: use the fees and taxes field for an estimate.
• It does not decide the price or the promotion: it shows the math for you to decide.
• It does not store or send your values: everything happens in your browser.

How do I calculate the price after a discount?

To calculate the price after a discount, multiply the price by (1 − discount). For example, 100 with a 10% discount becomes 100 × 0.90 = 90. The calculator does this and also shows what the customer saves.

How do I calculate the maximum discount without losing margin?

Enter the price, the cost and the minimum margin you want to keep. The minimum price is the cost divided by (1 − fees − minimum margin); the maximum discount is the gap between the full price and that minimum.

What is the difference between margin and markup?

Margin is calculated on the sale price: (price − cost) ÷ price. Markup is calculated on the cost: (price − cost) ÷ cost. A product priced at 100 that costs 60 has a 40% margin and a 66.7% markup.

How does “buy 3, pay for 2” work?

The customer takes 3 units and pays for 2. With equal prices, the discount is 33.3%. With different prices, the tool treats the free unit as the cheapest one.

How does a tiered discount work?

Each tier applies from a given quantity: the more units, the bigger the discount. The table shows the result for each quantity and flags when the margin drops below the minimum.

Do I have to enter the cost?

No. Without the cost, the calculator shows the final price, the savings and the real discount. The cost is only needed for margin and maximum discount.

Does the calculator include taxes and fees?

It uses the percentage you enter in the fees and taxes field. It does not calculate taxes or shipping; it is an estimate to help you decide the promotion.

Are my values sent to a server?

No. The math happens in your browser and nothing is sent or stored.