banderas movil 1
FollowUP logo BN alta

¡Haz parte de la conversación!

Deja tu comentario abajo y
forma parte del intercambio de ideas

Rate of discount of a product: how to calculate it and why is it important?

Facebook
Twitter
LinkedIn
TASA DE DESCUENTO DE UN PRODUCTO

The prices are a determinant factor for the client in regards to their purchase decision, so you should know well how to calculate the rate of discount of a product. Here we explain!

When it comes to search improve your sales figures, one of the most common approaches and successful applied for the store is to offer discounts on their products. However, it is very important to understand as we should calculate the discount price, so that you're not you as a retailer who is prejudiced.

It is advisable to set firm targets and to understand the different approaches that can be taken at the time of implementing a pricing strategy in retail, taking into consideration you how to calculate the right metrics to make sure you can achieve your business objectives.

How to calculate the discount rate?

Most of the retailers set their prices by using the pricing strategy of Keystonebasically it consists in doubling the cost of the product to achieve a profit margin of 50%. However, in some cases, it is recommended that the products sold for a price lower or higher depending on each situation.

But before moving to the mathematical calculation of the rate of discount of a product, it is important to understand its theoretical context, which involves the pricing in stores.

Strategy discount prices

All in the retail industry are aware of the taste of the consumers by the low prices. This is usually done through coupons, discounts, seasonal prices, among other discounts related to the promotion.

There are several scenarios in which it is beneficial to apply the strategy of discounted prices, since it is established that allows you to increase the traffic of people shop, as well as reducing the inventory difficult to sell and achieve to capture a group of consumers more price sensitive.

productos con descuentos

Formula for calculating the rate to discount

To calculate the rate of discount of a productyou can apply a formula very simple that will help you to obtain very good results:

Selling price = [(cost of product) ÷ (100 – percentage of charge)] x 100

Now let's just see better through the following example:

Suppose that you want to calculate the percentage discount of a product it costs you $15 with a profit margin of 45%, to perform the calculation you need to apply the formula and you will get the following result.

Sale price = [(15.00) (100 – 45)] x 100

Selling price = [(15.00 ÷ 55)] x 100 = $27.00

Importance of the calculation of the discount rate

Companies use discount prices to sell their products with low price in large quantities, it is important to reduce costs and maintain competitiveness in the market.

The strategy discount prices should be handled with caution, offering occasional discounts and rebates that reward the most loyal customers.

This is because cwhen discounts are given for very long periods, and frequent, it begins to be a downward spiral of prices that may affect the ability of the retailer to sell products at full price.

Suppose, for example, a retailer will have big discounts newspapers, this can be counterproductive to condition your market to customers who only wait for you to make new offers in your shop, decreasing profit margins.

Conclusion

In the retail trade is necessary to decide the role to play in terms of pricing is concerned, that is to say, you'll have to decide if you want to offer higher prices for your products and a lower volume of sales or otherwise sell products of lower price and higher volumes, always aiming to achieve the highest profitability for your business.

To help you in this task, it is important to know how to calculate the rate of discount of a productbecause through this formula, you can determine quickly and easily the sale value of the items and thus apply the pricing strategy that allow to increase the rate of convertibility of your store.

Leave A Comment