What is a bulk discount?
A bulk discount, also called volume or quantity pricing, is a lower price per unit for larger orders. Instead of one price for everyone, you publish a short table: one price for small orders, a better price once a buyer reaches a set quantity, and the best price for the largest orders. It gives buyers a clear reason to order more, and it lets you reward the orders that cost you least to pack and ship per unit.
How the calculator works
You enter a base price, which is what a buyer pays for the smallest order. Then you set up to three price breaks, each with the quantity where it starts and the discount off the base price. The calculator builds the tier table, rounds each price to the cent, and shows your margin at every tier if you add your cost per unit.
Enter an order quantity to see which tier it falls in, the price per unit, the order total and how much the buyer saves against the base price. Leave a tier blank to use fewer breaks.
The bulk discount formula
| Figure | Formula |
|---|---|
| Tier price per unit | Base price × (1 − tier discount) |
| Margin at a tier | (Tier price − your cost) ÷ tier price |
| Order total | Tier price × units in the order |
| Buyer saving | (Base price − tier price) × units in the order |
Each tier runs from its starting quantity up to one unit before the next tier starts. The top tier has no upper limit.
Example: your base price is $10.00 per unit and each unit costs you $4.00. You offer 10% off from 12 units, 15% off from 48 units and 20% off from 144 units. The table is:
- 1–11 units: $10.00, 60% margin
- 12–47 units: $9.00, 55.6% margin
- 48–143 units: $8.50, 52.9% margin
- 144+ units: $8.00, 50% margin
A buyer who orders 60 units reaches the 48–143 tier. They pay $8.50 × 60 = $510, and save $90 against the base price.
All-units or incremental pricing?
This calculator uses all-units pricing: once an order reaches a tier, every unit in it gets that tier's price. This is how most wholesale price lists work, and it is easy for buyers to check.
The other method is incremental pricing, where only the units above each break get the lower price, like a tax bracket. It protects your margin on mid-sized orders, but it is harder to explain on a price list. If you use it, say so clearly next to the table.
How to choose your price breaks
- Start from your margin floor. Decide the lowest margin you will accept, then check the top tier stays above it. A discount comes straight out of your profit, so 20% off a 50% margin product removes 40% of the profit on each unit.
- Match breaks to how you pack. If you ship in cases of 12, set breaks at 12, 48 and 144 so buyers order full cases.
- Keep it short. Two or three breaks are enough. Long tables make buyers do maths instead of ordering.
- Watch the edges. With all-units pricing, an order just below a break can cost more than one at the break. In the example, 47 units at $9.00 cost $423, while 48 units at $8.50 cost $408. That nudges buyers up to the break, which is usually what you want, as long as the margin at the higher tier still works.
- Price from your real cost. If you import, use your landed cost as the cost per unit, not the supplier price.
Common mistakes
- Setting discounts from what competitors offer without checking your own margin.
- Forgetting that your wholesale price is already a discount. Volume tiers stack on top of it, so start from a wholesale price that leaves room.
- Mixing up margin and markup. Use the margin calculator or the markup calculator to check each tier.
Put your tiers on a price list
Once the numbers work, publish them where buyers will see them. Our guide to creating a wholesale price list shows how to lay out tiered prices, and wholesale terms explained covers minimums and case packs. Then add your tiers to a price list your buyers can download or open as a link.