How to use this calculator
- Enter the original selling price.
- Enter the planned discount percentage.
- Add all product and order costs.
- Estimate the sales lift expected from the promotion.
Test whether a Shopify discount is profitable by comparing margin loss with expected sales lift. Use it before running coupons, flash sales, or seasonal promotions.
The calculator compares profit before and after discount. A promotion is healthier when expected sales lift exceeds the lift required to replace lost margin.
Discounts that reduce profit per order too much require very large sales lifts to break even.
An $80 item discounted 20% sells for $64. If cost is $42, profit falls from $38 to $22, requiring about 72.7% more sales to match profit.
Many stores start testing 10% to 20%, but the best discount depends on margin, customer price sensitivity, and expected sales lift.
A discount is too high when post-discount profit cannot be recovered by realistic increases in sales volume or customer lifetime value.
Discounts can increase revenue if they lift conversion and order volume, but they may reduce profit if margin loss is larger than sales lift.
Discounts directly reduce selling price while many costs stay fixed, so margin percentage and profit per order usually fall.
A break-even discount is the maximum discount where extra sales volume still offsets the lower profit per order.
| Metric | Use |
|---|---|
| Discounted Price | Customer-facing sale price. |
| Required Sales Lift | Sales increase needed to preserve profit. |
| Promotion Health | Whether expected lift supports the discount. |