This calculator helps you determine the maximum discount you can offer while still maintaining your target profit margin. It is essential for running promotions, sales campaigns, and pricing strategies without destroying profitability.
Discounting without understanding margin impact is one of the biggest causes of lost profit in ecommerce and retail. This tool ensures that every discount you offer still keeps your business sustainable.
Use it to set safe discount limits, guide marketing campaigns, and ensure pricing decisions are driven by real numbers.
Formula: Minimum price = Cost ÷ (1 − margin); Discount = 1 − (Min price ÷ Original price)
The calculator determines the lowest price you can sell at while still achieving your target margin. It then calculates the maximum discount you can apply from your original price.
First, the calculator determines the minimum price required to achieve your target margin based on your cost. It then compares this with your original selling price to calculate the maximum allowable discount.
If the minimum price exceeds your original price, your target margin is not achievable.
Example 1: Cost £14, Price £30, Margin 30% → Max discount 33.33%
Example 2: Cost £18, Price £20, Margin 40% → Not achievable
One that keeps your selling price above the minimum price required for your margin.
Because your target margin requires a higher price than your current selling price.
Use net prices for accurate margin analysis.