Discount Impact on Margin Calculator
See exactly how much a discount eats into gross margin and what unit volume lift you would need to break even.
Inputs
Margin Impact
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Run calculation
Margin before discount—
Margin after discount—
Margin loss per unit—
Volume lift needed to break even—
A 20% discount can require 50%+ more volume
On a $100 product with $60 cost ($40 margin), a 20% discount drops margin from $40 to $20 — a 50% margin cut. To net the same gross profit, you need to sell twice as many units. Most promotions never hit that volume lift.
Frequently Asked Questions
Should I ever discount?
Yes — for clearance, customer acquisition, or to defend margin against competitor moves. Just price the discount with eyes open.
Want promo strategy built on margin math, not gut feel?
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