Calculators / Discount
Discount calculator
Enter the price and the discount for the sale price. Add your cost to see how much of your profit the discount takes and how many extra sales it needs.
On sale
The formulas
Sale price = price × (1 − discount)
Profit = price − cost (before and after)
Sales needed = profit before ÷ profit after
Worked example
A $40 tote bag costs you $16 all in. You run 20% off for a weekend.
| Sale price | 40 × 0.80 = $32.00 |
|---|---|
| Profit | $24.00 before, 32 − 16 = $16.00 after |
| Margin | 60.0% before, 16 ÷ 32 = 50.0% after |
| Sales needed | 24 ÷ 16 = 1.5x |
A 20% discount means selling 50% more bags just to make the same money. If the sale usually brings in that many extra orders, it pays. If it mostly moves orders that would have come anyway, it costs you.
How deep a discount can you afford?
The lower your margin, the faster discounts eat it. A rough guide for the same product at different margins, before the discount:
| 60% margin, 20% off | needs 1.5x the sales |
|---|---|
| 40% margin, 20% off | needs 2x the sales |
| 30% margin, 20% off | needs 3x the sales |
| 20% margin, 20% off | no profit left at all |
If your margin is near the discount, offer something that costs you less than it is worth to the customer instead: free shipping over a threshold, a gift with purchase, or a bundle price.
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Formula and examples last checked October 9, 2026.
Questions people ask
How do I work out a percentage discount?
Multiply the price by the discount as a decimal to get the amount off, then subtract it. 25% off $80 is 80 × 0.25 = $20 off, so the sale price is $60. Or multiply by what is left: 80 × 0.75 = $60.
Why do I need so many more sales to make up for a discount?
The discount comes entirely out of your profit, not out of the price as a whole. If you make $24 on a $40 item and take $8 off, the profit drops by a third, so you need half as many sales again just to end up with the same money.
Do two discounts stack to the total of both?
No. 20% off and then a further 10% off is 0.8 × 0.9 = 0.72 of the price, which is 28% off, not 30%. Run the first discount, then put the sale price back in as the original price for the second.
Is a dollar-off discount better than a percent-off one?
For your margin, they are the same if the amount off is the same. Shoppers tend to notice dollars on expensive items and percentages on cheap ones, so pick the one that sounds bigger for the price.
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