Shopify Discount Profit Calculator
See how a discount affects your profit margin on Shopify and calculate the maximum discount you can offer without losing money.
By Marginory team · Online sellers with hands-on experience across Etsy, Shopify & PODUpdated Fee data verified against official platform documentation
Shopify plan
$
%
$
$
Before vs. after discount
Original price$59.99
Sale price (−20%)$47.99
Profit at original price$33.95 (56.6%)
Profit at sale price$22.30 (46.5%)
Profit lost per order$11.65
Maximum safe discount
Max discount amount$34.96
Max discount %58.3%
(Beyond this = loss per order)
How this is calculated
Sale price = Original price × (1 − 20%)
Profit = Sale price − (sale price × fees%) − $0.30 − Product cost − Shipping
Max discount = Original price − Break-even price
Assumptions:
- Using Shopify Payments
- Discount code (not automatic discount) — Shopify still charges fees on original price for some coupon types. This calculator uses the actual sale price as the fee base.
Source: https://www.shopify.com/pricing · Last verified: 2026-07-02
Related Tools
Frequently Asked Questions
How do discount codes affect Shopify profit?
Discount codes reduce your sale price, which reduces revenue and gross profit directly. Shopify's payment processing fee also decreases proportionally (since it's % of sale), but this partial savings rarely offsets the margin loss. Always calculate net profit at the discounted price before running a sale.
What is the maximum discount I can offer on Shopify?
Max discount = 1 − (Break-even price / Original price). Break-even price = (Product cost + $0.30) / (1 − payment rate). For a $15 cost product on Basic with Shopify Payments: break-even = $15.30 / 0.971 = $15.76. On a $30 product: max discount = 1 − 15.76/30 ≈ 47.5%.
What's a worked example of a 20% discount on Shopify?
A $40 product with $15 COGS and no separate shipping charge, on Basic with Shopify Payments (2.9% + $0.30): full-price profit = $40 − $1.46 − $15 = $23.54 (58.9% margin). At 20% off ($32): profit = $32 − $1.23 − $15 = $15.77 (49.3% margin). The margin drops nearly 10 percentage points even though the fee itself only fell $0.23 — the discount comes almost entirely out of profit, not fees.
Is it better to discount price or offer a free gift/bonus item?
A free bonus item often preserves margin better if its cost to you is lower than the equivalent cash discount's impact on your margin — e.g., a $2-cost bonus item feels like a bigger deal to the customer than a $2 price cut, but costs you less. Compare the actual dollar cost of each promo mechanic using this calculator before deciding.
What's a common mistake sellers make with discount codes?
Setting a percentage-off code (e.g., 20% off) without checking it against products with thin margins. A 20% discount on a product with 25% margin can turn a profitable sale into a break-even or loss-making one instantly. Segment discount eligibility by margin tier, or cap percentage discounts and use fixed-dollar discounts on low-margin items instead.
How do Shopify discount economics compare to Etsy or eBay sales/coupons?
The core math is the same everywhere — a discount reduces revenue while fixed and percentage fees barely move — but Shopify's lower percentage fee (2.9% vs Etsy's ~9.5% or eBay's ~13.6% total) means a given discount eats a slightly smaller share of your fee-adjusted margin on Shopify than on a marketplace charging higher transaction fees on the same discounted price.