I want to offer a 20% coupon in Ramadan; what should the list price be so I still keep a 15% margin after it?

Why start from the end

Your margin is set by what the customer actually pays, not the price shown before the discount. Percentage fees are also charged on the price paid. So the first question is: what is the least the customer must pay after the coupon? The Selling-price calculator answers that directly, since it assumes fees come off the actual selling price.

The steps

1. Enter cost, shipping, percentage fees and the margin you want after the discount, and read the price: 90.
2. Divide that price by what the coupon leaves. A 20% coupon leaves 80% of the price, so divide by 0.8.
3. The list price is 112.5. Check it in the Discount calculator: 20% off 112.5 gives 90.

Two common mistakes

• Adding 20% then taking 20% off: 90 plus 20% is 108, and 20% off that is 86.40, not 90. Profit is then about 10.08 and the margin about 11.67% instead of 15%. Raising and cutting by the same percentage does not cancel out.
• Applying the coupon to your normal price unchanged: if your price is 90 and you take 20% off, the customer pays 72, below the break-even price of 75.79, so you lose 3.60 on every order.

Before you raise the list price

Raising a price before a season and then discounting it is a move customers recognise, and your platform or the rules you trade under may have requirements on showing pre-sale prices. That is outside what the tool calculates, so check it yourself. A simpler path: if your current price is already above 112.5, the coupon will not take you below your margin and nothing needs to change. If it is lower, a smaller coupon may suit better. Try different rates and work out the paid price for each in the discount calculator.