2 min read
Extra volume needed = discount ÷ (margin − discount). A discount eats margin, so you must sell more just to keep the same profit.
How to use it
Enter your current gross margin and the discount you're thinking of offering. The result is the extra sales volume you'd need just to make the same total profit as before — the hidden cost of discounting.
The thinner your margin, the more damage a discount does. At a 40% margin a 10% discount needs a third more volume; at a 20% margin the same discount doubles the volume you must sell.
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Frequently asked questions
Why does a small discount need so much extra volume?
Because the discount comes straight off your profit, not your cost. If your margin is 40% and you cut price 10%, you keep only 30% margin, so every remaining sale earns less and you need many more of them to catch up.
Is discounting ever worth it?
Yes — to clear stock, win a strategic account, or fill quiet capacity that would otherwise be wasted. The point of this calculator is to go in with eyes open about the volume it really needs.
Is this a quote?
No — it's a free illustration. Your actual Credicorp offer depends on an assessment of your company.
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