Discount Margin Calculator
Before you print the coupon, see what it does to your profit. Type your price, what the unit costs you and the discount or cashback you plan to give. The calculator shows the margin that is left, how many more units you have to sell to make the same profit, and the discount at which you start selling at a loss.
- Free
- No sign-up
- Runs in your browser
Result
Type the price, the cost per unit and the discount or cashback to see what is left.
Amounts are rounded to the cent. The maximum is the point where the profit is zero, not a suggestion. It is arithmetic on your own numbers, not tax or accounting advice.
How the numbers are made
The discount comes out of the profit
The cost of the unit does not change when the price drops, so every cent of discount is a cent of profit. Profit with the offer = price - discount - cost. That is why a 15% discount on a 40% margin takes 37.5% of the profit, not 15%.
Margin after the offer
Margin = profit ÷ what you keep from the sale. After a discount you keep less and the profit shrinks faster than the price, so the margin drops on both sides of the division.
The extra sales that make up for it
To earn the same total profit you need profit before ÷ profit after as many units. Take 1 from that and you have the extra sales, as a percent. The thinner the margin, the steeper it gets: the same discount can ask for a few more sales or for five times the volume.
The maximum discount
The discount at which a unit sells at cost is your margin at the regular price, as a percent of that price: (price - cost) ÷ price × 100. It is where the profit reaches zero, not a discount to aim for.
Cashback
A cashback is a part of the price you give back later. If every customer uses it, it costs you the same as a discount of the same percent. If only a share is used, the cost is the cashback × that share, which you type yourself. Left empty, the calculator counts all of it.
What this leaves out
Whether the offer really brings the extra sales, customers who would have paid the full price anyway, fixed costs, and taxes that change with the price. Put everything you spend per unit in the cost field.
Formulas
- Profit per unit with the offer
- price - price × discount - cost
- Margin after the offer
- profit with the offer ÷ (price - price × discount) × 100
- Profit per unit falls by
- (profit before - profit with the offer) ÷ profit before × 100
- Extra sales for the same profit
- (profit before ÷ profit with the offer - 1) × 100
- Units for the same profit
- units today × profit before ÷ profit with the offer, rounded up
- Maximum discount
- (price - cost) ÷ price × 100
- Cost of a cashback
- price × cashback × share of the cashback that is used
An offer only works if people see it before it ends
VISU Local gives your business a free page with address, map, hours and phone. Put a dynamic VISU QR on the coupon or the counter sign: when the offer ends you change where it points, without reprinting.
Create your free pageSee VISU LocalHow to use it
- Choose what you are offering: a discount or coupon, or a cashback.
- Type the regular price and what one unit costs you, counting packaging, shipping and card fee.
- Type the percent of discount or cashback. For the extra sales in units, add how many units you sell today.
- Read the margin that is left, the extra sales you need for the same profit and the maximum discount before a loss.
Examples
15% off a product with a 40% margin
Made-up numbers to show the maths: price $80.00, cost $48.00, so $32.00 of profit and a 40% margin. With 15% off you keep $68.00 and the profit falls to $20.00: a 29.41% margin and 37.5% less profit per unit. To make the same profit you need 60% more sales: 160 units instead of 100. The maximum discount is 40%.
The same idea on a thin margin
Price $80.00 and cost $60.00 leave $20.00, a 25% margin. A 20% discount leaves $4.00 per unit, a 6.25% margin: you would have to sell 400% more, five times the volume, to earn the same.
10% cashback when 70% of it is used
Price $80.00, cost $48.00, cashback of 10% and 70% of it used: the offer costs 7% of the price, $5.60 per unit. Profit is $26.40, a 35.48% margin, and 21.21% more sales make up for it.
Questions
How much discount can I give without losing money?
Up to your margin at the regular price: (price - cost) ÷ price. With a price of 80 and a cost of 48 that is 40%. At that discount you sell at cost. It is the point of zero profit, not a recommendation: above it every sale loses money, and a 45% discount on that product loses $4.00 per unit.
How many more sales do I need to make up for a discount?
Divide the profit per unit before the discount by the profit per unit after it and take away 1. With a profit of 32 that falls to 20, it is 32 ÷ 20 - 1 = 60% more units for the same total profit.
Why does a 15% discount cut my profit by more than 15%?
Because the cost stays the same and the whole discount comes out of the profit. On a price of 80 with a cost of 48, 15% off takes 12 from a profit of 32: that is 37.5% of the profit.
Does cashback cost less than a discount?
Only when part of it is never used. A cashback of 10% that every customer uses costs the same as 10% off. If you know from your own records what share gets used, type it and the calculator charges only that share. It does not assume one for you.
What goes in the cost per unit?
Everything you spend because that unit was sold: the product or its ingredients, packaging, shipping you pay and the card fee. Rent and salaries are not per unit and stay out.
Is this a calculator for shoppers?
No. It is built for the person who sells. What the customer pays is there, in the "you keep per unit" row, but every other number is about your margin and your profit.
Does a discount pay off if it brings more customers?
It can, and the calculator tells you how many: the extra sales row is the minimum the offer has to bring just to match the profit you already had. Whether it will is something only your own past offers can tell you.
Are my numbers stored?
No. The maths runs in your browser. Your prices and costs are not uploaded, are not added to the page address and are not saved.