Discount Break-Even Volume Calculator (How Much More Must You Sell?)
How much extra volume a price cut must bring to leave your gross profit unchanged: d ÷ (m − d), with the units you would need to sell.
Results
Extra sales volume needed
33.3
%
Extra units to sell
333
Total units to sell
1333
Gross margin on the discounted price
33.3
%
Can extra volume make up for it?
Yes, with the extra volume shown
What this tool does
A discount is a pay cut on every unit, so you must sell more units just to stand still. With a 40 % gross margin, a 10 % discount cuts the margin per unit from 40 to 30 (of the original price), so you need 40 ÷ 30 = 33 % more units, and the formula d ÷ (m − d) gives that straight away. The thinner the margin, the steeper it gets: at a 20 % margin the same 10 % discount needs double the volume, and a discount equal to the margin can never be recovered, whatever the volume.
Formula
extra volume needed = d ÷ (m − d) (d = discount %, m = gross margin %, both of the original price)
Variables
| Symbol | Meaning | Unit |
|---|---|---|
m | Gross margin | % |
d | Discount | % |
q | Units you sell now | — |
X | Extra sales volume needed | % |
XU | Extra units to sell | — |
TU | Total units to sell | — |
NM | Gross margin on the discounted price | % |
ST | Can extra volume make up for it? | — |
Worked example
- Gross margin40 %
- Discount10 %
- Units you sell now1000
- Extra sales volume needed33.3 %
- Extra units to sell333
- Total units to sell1333
- Gross margin on the discounted price33.3 %
- Can extra volume make up for it?Yes, with the extra volume shown
Limitations
- This is an informational calculator, not personalised financial advice. Rates, fees, taxes and contract conditions vary between institutions and countries.
- The tool works with whatever currency you use for the inputs; it does not convert between currencies.