Maximum profitable discount calculator
How far you can cut the price without falling below the margin you want to keep.
≈ 2 minutes
Work out my maximum discount
Sales needed to offset a discount
A 15 % discount does not require selling 15 % more. It requires considerably more, because what gets cut is not the price but the contribution, and contribution is a fraction of the price. This calculator turns the discount you are considering into the exact number of units you would have to sell to end up where you started.
Every calculation runs in your browser. The figures you type are never sent to a server and are never stored.
Your results will appear here
Enter your current price, the discount you are considering and your variable costs.
- Current price and the discount you want to apply
- Variable costs per unit and channel fee
- Current sales, if you want the result in units
Calculation results
Required sales uplift
—
How much more you must sell to keep the same profit.
Sales factor—How many times current sales
Discounted price—
Current contribution—
Contribution after discount—
Loss per unit—
Sales needed—
Additional units—
See the breakdown
| Current price | — |
| Discounted price | — |
| Current contribution | — |
| Contribution after discount | — |
| Loss per unit | — |
| Sales factor | — |
| Units needed, before rounding | — |
Recommended next step
If the volume required is out of reach, look again at where your contribution comes from: often the problem is not the discount but a variable cost nobody was counting.
Review my contribution marginResults are estimates based on the information you enter. Fees, taxes and platform terms can change: always check the figure that matters to you against your invoice or the official platform. They do not replace your real invoices, your official accounts or professional tax, financial or legal advice.
What this tool works out
This discount break-even sales calculator answers the question almost nobody asks before launching a promotion: how much more do I have to sell to avoid coming out behind?
The answer surprises people because intuition works in prices and the business works in contributions. A discount cuts the price by a small percentage but cuts contribution by a much larger one, because contribution is only part of the price.
Why you need to sell so much more
Picture a $60 product with $30 of variable costs and a 5 % fee. Its contribution is $27 per unit.
A 15 % discount takes the price to $51. Just $9 less. But contribution falls from $27 to $18.45: almost a third has gone. The price dropped 15 % and the contribution 31.7 %.
Since total profit is contribution times units, recovering that lost third takes almost 50 % more sales. That disproportion is what sinks promotions that looked harmless.
How the formula works
The sales factor is the ratio between the two contributions.
new price = current price x (1 - discount %/100)
current contribution = current price x (1 - fee %/100)
- variable costs
new contribution = new price x (1 - fee %/100)
- variable costs
sales factor = current contribution / new contribution
increase needed = (factor - 1) x 100
units needed = round up(current sales x factor)
additional units = units needed - current sales
The factor, the contributions and the percentage stay exact. Rounding up is applied once and only to the final unit count, because half a unit does not sell.
A worked example
A product selling at $60, with $30 of variable costs and a 5 % channel fee. A 15 % discount is under consideration, and 200 units currently sell each month.
| Item | Value |
|---|---|
| Current price | $60.00 |
| Discounted price | $51.00 |
| Current contribution | $27.00 |
| Contribution after discount | $18.45 |
| Loss per unit | $8.55 |
| Sales increase needed | 46.34% |
| Units needed before rounding | 292.68 |
| Units needed | 293 |
| Additional units | 93 |
The price drops to $51, but contribution falls from $27 to $18.45: $8.55 lost per unit. Matching the same profit takes 46.34 % more sales, that is 293 units instead of 200: 93 additional units every month. A 15 % discount demanding almost 50 % more volume.
How to read the result
The increase needed is the bar: below it, the discount leaves you worse off even though you sold more. Compare it against what your experience says about how a promotion actually moves your catalog.
The larger the increase required, the stronger the reason you need to believe it will happen. A bar that multiplies your current sales is a considerable bet, and it is better supported by what your previous promotions actually did than by an expectation.
Units needed are rounded up because they are physical units: if the theoretical calculation asks for 292.68, you have to sell 293. That rounding is honest presentation, not imprecision: the factor and contributions keep every decimal.
When no volume offsets it
If the discount leaves contribution at zero or negative, no volume fixes anything: every unit sold subtracts. Doubling sales that lose money doubles the loss.
The calculator flags this explicitly rather than returning a huge factor that could be mistaken for 'you need to sell a lot more'. You do not need to sell a lot more: you need to not apply that discount.
What to decide next
If the volume required is out of reach, either the discount is too big or the margin is too thin. It is worth going back to that product's contribution and seeing where it comes from: sometimes the problem is not the promotion but a variable cost nobody was counting.
What this assumes
- Variable costs per unit do not change with the discount
- The channel fee applies to the price actually charged
- The goal is to match total profit, not to beat it
- The current sales you enter are whole units
- The result in units is rounded up to whole units
What it does not cover
- Whether the discount will actually generate that extra volume
- The cost of serving more orders: shipping, support, returns
- Cannibalizing sales that would have happened without a discount
- The effect of discounting on your future reference price
- Fixed costs, which do not change with volume
Frequently asked questions
Why does a 15 % discount demand almost 50 % more sales?
Because the discount applies to the price while profit depends on contribution, which is only part of the price. At $60 with $27 of contribution, taking $9 off the price removes a third of the contribution: the percentage effect on what you earn is far larger than on what you charge.
Which variable costs do I enter?
Everything that depends on selling the unit: product, packaging, shipping you absorb, pick and pack, and returns provision. The fee goes separately because it is a percentage of price and it falls when you discount.
Are current sales required?
No. Without them you get the factor and the percentage increase, which is the essential part. Enter them and you also see the result in concrete units, which is usually easier to judge than a percentage.
Why are units rounded up?
Because they are physical units and half a unit does not sell. If the theoretical calculation asks for 292.68, you have to sell 293 to avoid falling short. The factor and contributions stay exact: rounding happens once, at the final count.
What does it mean when no volume offsets it?
That the discount leaves contribution at zero or negative, so every unit sold subtracts instead of adding. Doubling sales fixes nothing: it doubles the loss. The only way out there is a smaller discount.
Do I count the extra cost of serving more orders?
The calculator does not, and it is worth remembering. Selling 46 % more also means 46 % more shipments, support and returns. If those costs are already inside your variable cost per unit, they are covered; if not, the real bar is somewhat higher.
What if the discount applies only to part of my sales?
Then the bar is lower, because undiscounted sales keep their contribution. Work out the effect only on the units that will carry the discount and compare it against the profit those units were leaving before.
What should I work out after this?
Where your contribution comes from. If the volume required is unreachable, the problem is often not the promotion but a variable cost that was overlooked and is squeezing the starting margin.
Official sources
Shopify — break-even analysis and contribution marginhttps://www.shopify.com/blog/break-even-analysis
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