Please enter a valid retail price (> 0).
Please enter a valid cost price (≥ 0).
Please enter a discount between 0 and 100.
Disc. Price = Retail × (1 − D%)
Disc. Profit = Disc. Price − Cost
Units needed = ⌈Orig. Profit ÷ Disc. Profit⌉
Running a sale is a great way to boost conversion rates and clear out old inventory, but discounts can have a devastating and disproportionate impact on your profitability. The Discount Profit Calculator helps you visualize exactly what happens to your margins when you offer a percentage off or a fixed dollar discount.
When you discount a product, the entire discount amount comes directly out of your net profit, while your cost of goods remains exactly the same. For example, if you have a 30% profit margin and you offer a 20% discount, you haven't just lost 20% of your profit—you've lost nearly two-thirds of it. This calculator instantly recalculates your new selling price, new net profit, and new margin, ensuring you never accidentally run a promotion that causes you to lose money on every sale.
Because a discount is applied to your total revenue, but it is subtracted entirely from your profit slice. If you sell an item for $100 that costs $70, your profit is $30. A 10% discount reduces the price to $90. Your profit is now $20. A 10% discount just reduced your actual profit by 33%.
Psychologically, the 'Rule of 100' suggests that for items under $100, a percentage discount (e.g., 25% off) looks more appealing. For items over $100, a fixed amount (e.g., $50 off) feels like a better deal to the consumer, even if the actual mathematical discount is identical.
Yes, but only if the discount significantly increases your sales volume or customer lifetime value. If offering a 15% discount causes you to sell three times as many units, your total aggregate profit for the month may be higher, even though the margin on each individual unit is lower.