E-commerce

Discount & Profit Calculator

Check what a discount leaves you before you run it, including the discount at which the sale starts costing you money.

7 inputs Free, no sign-up

Your figures

The price before the discount - what the listing shows struck through.

The percentage off you are planning to offer.

What one unit costs you.

Costs on the sale

The percentage from your own fee statement.

Try an example

Result

Your result

Enter your figures and the result appears here.

Estimates only. Rates, fees and specifications change. Confirm against the official source before you rely on a figure — see our disclaimer.

About this calculator

A discount is not taken out of your margin proportionally - it is taken out of it entirely. Cut a price by 20% and the fee falls by 20% too, but the product still costs exactly what it cost. All of the reduction comes out of the profit.

This calculator shows what is left after the discount, and the figure worth knowing before any sale: the discount at which the profit reaches zero.

How to use this calculator

  1. Enter the MRP and the discount you are considering.
  2. Enter what the product costs you.
  3. Add the fee percentage from your fee statement, and anything else you pay.
  4. Read the profit at that discount, and the discount that would wipe it out.

The formula

Customer pays  = MRP - MRP x discount% / 100
Fees           = Customer pays x fee% / 100 + fixed fee
Profit         = Customer pays - fees - shipping - other costs - product cost

The discount that reaches break-even is found by solving for the price at which the profit is nothing:

Break-even price    = (costs + fixed fee) / (1 - fee% / 100)
Break-even discount = (MRP - break-even price) / MRP x 100
SymbolMeaningUnit
MRP The price before the discount Rs
Discount The percentage taken off the MRP %
Break-even The discount at which profit reaches zero %

Worked example

An MRP of 1,999 discounted 25%, on a product costing 850, with a 15% fee:

MRP                  1,999.00
Discount              -499.75   (25% off)
Customer pays        1,499.25
Marketplace fee       -224.89   (15%)
Product cost          -850.00
Profit                 424.36   (28.3% margin)

The break-even price here is exactly 1,000, so the discount could go to 49.97% before the sale stopped making money. Anything beyond that is paying customers to take the product.

Notes and limits

Fee figures are the ones you enter, not published marketplace rates. Take them from your own fee statement - they are right for your account, which no published rate can be.

  • The fee is charged on what the customer actually pays, not on the MRP.
  • Extra volume from a discount is not modelled. A discount that halves the profit per unit needs to double the units just to stand still.
  • GST is not separated out here; use the GST profit calculator if the price includes tax.

What this calculation assumes

  • The discount is taken off the MRP, and the fee is charged on what the customer pays.
  • Fee figures are yours, not published marketplace rates.
  • Any change in sales volume from the discount is not modelled.

Frequently asked questions

Why does a 25% discount cut my profit by much more than 25%?

Because the product cost does not move. If a sale at 1,499 leaves 424 of profit, the 500 taken off the MRP comes almost entirely out of that 424 - only the fee on the discounted portion is saved. A discount smaller than your margin can still remove most of it.

What is the break-even discount?

The discount at which the sale brings in exactly what it costs and leaves nothing. Past it, each unit sold loses money, so selling more makes it worse. It is the number to check before agreeing to a marketplace sale event.

Should I discount at all, then?

That is a business question this calculator cannot answer - a discount might buy visibility, reviews or a cleared shelf. What it can tell you is precisely what the discount costs, so the decision is made with the number in front of you rather than after the payout arrives.

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