Discount Break Even Calculator

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This discount break even calculator shows what a sale really costs you before you launch it. Enter your price, product cost, shipping, payment fee and the discount you plan to run, and it returns your contribution margin before and after the discount, the break-even ROAS for both, and how many more orders the sale has to produce just to stand still.

It is built for Black Friday, Cyber Monday and any promotion where the discount is decided in a meeting and the margin is checked afterwards. A 25% sitewide offer sounds modest until you see that it can remove more than 40% of the profit in each order. Run the numbers first, then choose a discount depth your margin can survive.

How much more do I need to sell to break even on a discount?

Divide your contribution margin per order before the discount by the margin after it. On an $80 order with $44.60 of margin, a 25% discount cuts margin to $25.20, so you need 1.77 times the orders, or 77% more, to earn the same total contribution. Break-even ROAS rises from 1.79x to 2.38x.

Discount break-even calculator

Inputs: Selling price per order ($), Product cost (COGS) per order ($), Shipping and fulfilment per order ($), Payment processing fee (%), Discount (%). The calculator runs in your browser; nothing is stored.

How to use the discount break-even calculator

Use per-order figures based on your normal, full-price average order. The calculator applies the discount to that price and keeps your costs the same, because a discount lowers what the customer pays, not what the product costs you.

Selling price per order: your usual average order value before any sale discount.
Product cost (COGS) per order: the landed cost of the goods in a typical order, including supplier price, inbound freight and duties.
Shipping and fulfilment per order: outbound postage, packaging, pick and pack and any 3PL fees you pay on each order.
Payment fee %: the percentage your payment provider takes. It is charged on the discounted price, so it falls slightly during a sale.
Discount %: the depth of the offer, for example 20 for 20% off sitewide.

The formulas with a worked example

The calculator compares one order at full price with the same order at the sale price.

Contribution margin before discount = price - COGS - shipping - (price x fee %)

Discounted price = price x (1 - discount %)

Contribution margin after discount = discounted price - COGS - shipping - (discounted price x fee %)

Break-even ROAS before = price / margin before. Break-even ROAS after = discounted price / margin after.

Sales multiplier = margin before / margin after. A result of 1.6 means you need 60% more orders to earn the same total contribution.

Example (illustrative numbers, not client data): an $80 order with $24 COGS, $9 shipping and fulfilment and a 3% payment fee. The fee is $2.40, so margin before the discount is $80 - $24 - $9 - $2.40 = $44.60 and break-even ROAS is 1.79x. With 25% off, the price becomes $60 and the fee $1.80. Margin after is $60 - $24 - $9 - $1.80 = $25.20, break-even ROAS rises to $60 / $25.20 = 2.38x, and the sales multiplier is $44.60 / $25.20 = 1.77. The sale needs 77% more orders to earn what full price would have.

Discount	Sale price	Margin per order	Break-even ROAS	Sales multiplier
0%	$80.00	$44.60	1.79x	1.00
15%	$68.00	$32.96	2.06x	1.35
25%	$60.00	$25.20	2.38x	1.77
40%	$48.00	$13.56	3.54x	3.29

How to read the result and what to do next

The sales multiplier is the number to argue about in planning. Ask whether the sale can realistically lift order volume by that much. A 1.35 multiplier is often achievable during BFCM when demand is high and ad auctions reward strong offers. A 3.29 multiplier means the offer needs more than three times the orders just to match full-price profit, which rarely happens.

The break-even ROAS after the discount becomes your new floor for every campaign running the offer. If your Meta account usually lands around 2.2x, a 15% offer keeps you above break-even while a 25% offer pushes you under it. Set your sale bidding and cost caps from the after-discount number, not your usual target. If the margin after the discount is zero or negative, the offer loses money before a single ad dollar is spent.

Test a smaller discount paired with a gift or bundle, which often protects margin better than a deeper percentage.
Check your full-price floor first with the break-even ROAS calculator at /tools/break-even-roas-calculator.
Plan sale week campaigns, budgets and creative with our BFCM Meta ads playbook at /blog/bfcm-meta-ads-playbook.
If you want the sale run for you, see BFCM ads management at /bfcm-ads-management.

Common discount planning mistakes

Most margin damage during sales comes from a few predictable errors. Each one makes the discount look cheaper than it is. For a deeper look at the margin maths, read our contribution margin guide at /glossary/contribution-margin.

Treating 25% off as a 25% cut in profit. Because costs stay fixed, the profit cut is much larger.
Keeping normal ROAS targets during the sale, so campaigns that look healthy are actually below the new break-even.
Stacking discount codes, free shipping and gifts without adding up their combined cost per order.
Counting orders that would have happened at full price as sale wins. Existing customers who were going to buy anyway still get the discount.

Proof from real accounts

3.56x ROAS during BFCM: $59,241 on $16,630 spend for a women's fashion brand (see the proof)
$112,866 Revenue in 13 days: On $28,391 spend with early BFCM offers (see the proof)
$50M+ Meta ad spend managed: Across our client accounts over 12+ years in ecommerce

Frequently asked questions

How do I calculate the break-even point of a discount?

Work out contribution margin per order at full price and at the discounted price, keeping COGS and shipping the same. Divide the full-price margin by the sale margin. The result is how many times more orders you need. If it is 1.5, the sale must deliver 50% more orders to earn the same total contribution.

Why does a 20% discount cut my profit by more than 20%?

The discount comes entirely out of your margin while product cost and shipping stay the same. If an $80 order makes $44.60 and you take $16 off, margin drops by about 35%, not 20%. The thinner your margin to begin with, the larger the share of profit a discount removes.

What discount should I run for Black Friday?

Pick the deepest discount whose sales multiplier you believe the sale can deliver, and whose after-discount break-even ROAS your ads can beat. For many brands that points to a moderate percentage plus a bundle or gift, rather than the deepest headline number. Run each option through the calculator before deciding.

Does a discount change my break-even ROAS?

Yes. Break-even ROAS is price divided by contribution margin, and a discount lowers margin faster than it lowers price. In our example a 25% discount moves break-even ROAS from 1.79x to 2.38x. Campaigns running the offer need a higher return just to avoid losing money on each order.

Are bundles better than percentage discounts?

Often, because a bundle raises order value while the extra items cost you their product cost, not their retail price. That usually protects contribution margin better than a flat percentage off. Model both: enter the bundle price and combined COGS as one order, then compare its margin with the percentage discount version.

Planning a sale and worried about margin?

Book a Brand Growth Audit. Gaurav reviews your offer, unit economics and ad account with you and helps set a discount and ROAS floor your margin can carry. Book a Brand Growth Audit.