Discount Margin Calculator

What a discount costs in margin, and the volume it would take to absorb it.

Reference

Margin is always calculated ex-VAT, against an ex-VAT cost price. Example values, not normative. Use a point for decimals, e.g. 1.5.

Discount stack

Discount 1
Discount 2
Discount 3
Discount 4

Discounts apply in the order shown, each on the price coming out of the previous one. Entries stay in the browser and disappear when the tab is closed.

Gross margin rate before
0
Gross margin rate after
0
Extra volume required
0
reading

The stack

Starting price
0
Final price
0
Equivalent discount
0
Price before and after each discount in the stack
Step Discount Price before Amount taken off Price after

The tipping point

Discount wiping out the margin
0
Distance from the stack
0

Sensitivity scale

Residual gross margin rate and volume required for a single discount applied to the starting price
Discount Price Unit margin ex-VAT Gross margin rate Volume required Marker

What this calculation does not say
1. The offsetting volume is an arithmetic threshold: neither whether it is reachable on this item, nor how long it would take, is part of the calculation.
2. The cost price is held constant: a supplier tier or a different logistics scheme would improve the result without being captured.
3. Nothing is said about neighbouring items: a discount that moves volume within the same shelf improves the line and damages the category.
4. No memory effect is modelled: repeated, a discount shifts the customer's reference price and makes the return to list price more costly.