In this article we explain the difference between volume and progressive discounts, and when you would use them
There are two types of discounts, volume discounts and progressive discounts:
Volume Discounts
The discount is applied on the total of all the purchased items e.g. £50 off the total if 5 items are purchased.
Progressive Discounts
The discount is applied step by step, according to your sequence e.g. The second person receives a £5 discount, and the third person pays £2.50.
Volume Discounts
In this example, the admin wants a discount on their T-Shirts, where:
- if a customer buys 2 items, they receive a 10% discount off their total bill
- if they buy 3 or more items, they get 20% off their total bill
All items purchased will receive the same discount.
The Outcome for Volume Discounts
As you can see in the below case, the discount has worked as described above:
- In the first instance: one item costs full price: £10
- In the second instance: two items costs £18 total
- All t-shirts receive the 10% discount: £9 each
- In the third instance: three items costs £24 total
- All t-shirts receive the 20% discount: £8 each
Progressive Discounts
In this example, the admin wants a discount on their T-Shirts where the discount does not affect all items equally:
- If a customer buys two items:
- item one remains full price
- item two receives a 10% discount
- If a customer buys three or more items:
- items one remains full price
- item two receives a 10% discount
- item three and on get a 20% discount
As you can see, the set up is the exact same in both cases, but for the Volume or Progressive choice.
The Outcome for Progressive Discounts
As you can see in the below case, the discount has worked as described above:
- In the first instance: one item costs full price: £10
- In the second instance: two items costs £19 total
- T-shirt one costs full price: £10
- T-shirt two receives the 10% discount: £9
- In the third instance: three items costs £27 total
- T-shirt one costs full price: £10
- T-shirt two receives the 10% discount: £9
- T-shirt three receives the 20% discount: £8