Discount Calculator
See the sale price, what a discount does to your margin, and how many more sales you need to earn the same profit.
How a discount affects your profit
A discount lowers the price, but your product cost stays the same, so the whole discount comes out of your profit. That's why a modest discount can call for a large increase in sales just to stand still.
Profit after = Sale price − Cost
Extra sales needed = (Profit before ÷ Profit after − 1) × 100
Worked example
A product sells for $50 and costs $20, so each sale makes $30. At 20% off the price is $40 and each sale makes $20. Selling 100 units at full price earns $3,000; at the sale price you need 150 units to earn the same, which is 50% more sales.
Discount calculator FAQ
How do I calculate a percentage discount?
Multiply the price by 1 minus the discount as a decimal. 20% off $50 is 50 × 0.8 = $40, so the customer saves $10.
How do I work out the discount percentage from two prices?
Subtract the sale price from the regular price, divide by the regular price and multiply by 100. A price cut from $50 to $40 is (50 − 40) ÷ 50 × 100 = 20% off.
Why do I need so many more sales after a discount?
The discount comes out of your profit, not your cost. On a $50 product that costs $20, 20% off cuts the price by 20% but cuts the profit per sale from $30 to $20, a third less. You need half as many sales again to earn the same total profit.
Does a discount change my margin percentage?
Yes, and by more than you might expect. In the example above the margin falls from 60% to 50%, because the profit falls by $10 while the price only falls to $40.