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Pricing & Profit4 formulas shown

Discount Impact Calculator

A discount comes out of profit, not revenue — which is why 10% off can erase a quarter of what a job earns. Enter your price, the job's cost and the discount to see the profit lost and the extra volume needed to replace it.

Method and content reviewed September 23, 2026 · formulas checked against a test suite · runs entirely in your browser

Profit after discount $330.00. That erases 26.7% of the profit.

The job

What you'd quote without a discount
Variable cost of doing this job — burdened labor, materials, subs, trips

The discount

Between 0 and 100

Each 1% off this job costs 2.7% of its profit. The same discount hurts a thin-margin job far more than a fat one.

Profit after the discount
$330.00
FormulaProfit before ÷ Profit after = jobs needed to stand still
Your calculation$450.00 ÷ $330.00 = 1.36 jobs
Costs don't discount themselves, so the volume you need grows faster than the discount does.

To earn what one full-price job earned, you'd need 1.36 jobs at the discounted price — 36.4% more work, more trips and more risk for the same money.

Profit before discount
37.5% margin on $1,200.00
$450.00
Discounted price
$1,200.00 − $120.00
$1,080.00
Profit after discount
$330.00
Margin after discount
Was priced to carry more than this
30.6%
Profit erased
26.7%
Jobs needed to earn the same
36.4% more volume for identical profit
1.36×

This is the arithmetic that makes "give them 10% and make it up on volume" so expensive: the discount comes out of the smallest number on the job.

What each discount does to this job

The same job at your price and cost, discounted by common amounts. Volume needed is how many discounted jobs it takes to replace the profit of one job at full price.

DiscountPriceProfitMarginProfit erasedVolume needed
5%$1,140.00$390.0034.2%13.3%1.15×
10%$1,080.00$330.0030.6%26.7%1.36×
15%$1,020.00$270.0026.5%40.0%1.67×
20%$960.00$210.0021.9%53.3%2.14×
25%$900.00$150.0016.7%66.7%3×
30%$840.00$90.0010.7%80.0%5×

"Never" means the discounted price no longer covers the job's cost — no amount of volume recovers it.

Worked example

Plumbing: where the number comes from

A repeat customer asks a plumber for 10% off a $1,200 job that costs $750 in labor, parts and disposal. (Illustrative example — use your own numbers.)

InputValue
Normal price$1,200
Job cost$750 (labor, parts, disposal)
Discount requested10%

Result: 10% off erases 26.7% of the profit — you'd need 36% more jobs to earn the same money

The discount is 10% of the price but 26.7% of the profit, and it pulls the margin from 37.5% to 30.6% — below what the job was priced to carry. If the customer needs a lower number, removing a line of scope keeps the margin on the work that remains; a flat discount on the same scope doesn't.

Load this example into the calculator

The calculation

Profit before$1,200 − $750 = $450.00
Discounted price$1,200 × 0.90 = $1,080.00
Profit after$1,080 − $750 = $330.00
Profit erased($450 − $330) ÷ $450 = 26.7%
Margin after$330 ÷ $1,080 = 30.6%
Extra jobs to match one old job$450 ÷ $330 = 1.36 jobs (36.4% more)

How this calculator works

Every result comes from the formulas below — the math shown is the math used. Change any input and results update instantly in your browser; nothing is sent to a server.

  • Discounted price: Discounted Price = Price × (1 − Discount ÷ 100)
  • Profit at each price: Profit = Price − Job Cost
    Your costs don't shrink when the price does — that's the entire problem with discounting.
  • Share of profit erased: Erased % = (Profit before − Profit after) ÷ Profit before × 100
    A 10% discount on a 37.5%-margin job erases 26.7% of the profit, not 10%.
  • Extra volume to stand still: Volume Multiplier = Profit before ÷ Profit after
    How many discounted jobs it takes to earn what one job used to earn.

What the result means

The profit after the discount is real money you keep once the job's costs are paid. The erased share and the volume multiplier are the same fact stated twice: a discount is taken out of the smallest number in the job, so it costs far more profit percentage than price percentage.

When to use it

Use it before agreeing to any discount, to see what it costs in profit and how much extra work would be needed to replace it. It's also the honest answer to 'can you do better on price?' when the answer is scope, not price.

Want the concept behind the math in depth? Read What a Discount Really Costs (And What to Offer Instead) or Markup vs. Margin: The Pricing Difference That Costs Contractors Money or When to Raise Your Prices — and How Much You Can Afford to Lose.

Common mistakes

  • Comparing a discount to a markup as if they were symmetric — they aren't; costs don't discount themselves.
  • Discounting the same scope instead of removing a line of work, which lowers the price and the margin at the same time.
  • Treating 'we'll make it up on volume' as arithmetic: check the volume multiplier before believing it.

Frequently asked questions

Why does a 10% discount cost more than 10% of my profit?

Because the discount is measured against the price while profit is a fraction of the price. A $1,200 job that costs $750 earns $450, a 37.5% margin. Ten percent off is $120 — measured against the price that's 10%, but measured against the profit it's 26.7%. The smaller your margin, the more brutal the arithmetic: on a 15% margin, a 10% discount wipes out two-thirds of the profit.

How much extra work does a discount require to break even?

Divide the profit before the discount by the profit after. On the example above, $450 ÷ $330 = 1.36, so you'd need 36% more jobs to earn the same money. This is why discounting for volume only makes sense when you have idle capacity and the extra work genuinely costs nothing more than variable cost — otherwise you're buying revenue with profit.

Should I ever discount?

Yes, when it buys something specific: work that fills capacity you'd otherwise waste, a trade for faster payment or flexible scheduling, bundled repeat work, or a customer acquisition you're deliberately paying for. What doesn't work is discounting as a reflex to a lower competing bid — that sets a price expectation you'll have to live with on every future job.

Is it better to discount or to reduce the scope?

Reducing scope, almost always. A discount on the same scope lowers both the price and the margin percentage, so the job carries proportionally less overhead than your pricing assumed. Removing a line — the optional fixture, the second coat, the trim detail — lowers the price while keeping the same margin on the work that remains. Same customer outcome, protected economics.

What is the lowest price I can accept on a job?

The floor is the job's variable cost plus the overhead it must carry — at or below that, the work is subsidising the customer. Use the Margin Calculator to check the margin any final price actually carries, and your Overhead Calculator to know what share of revenue the job is expected to contribute. Below the floor, it's cheaper to leave the job unbooked.

Next step

Before you agree to a lower number, check the margin that price actually leaves.

Check the margin on this price →