How do I know if a discount is worth it?

Compare the cost of the discount (rate × redeemed volume) against the incremental gross profit from the extra visits it drives. If incremental profit exceeds the discount cost, the offer pays for itself. This tool estimates both sides so you can see the net.

What is a good redemption rate for a loyalty programme?

It varies widely, but many retail loyalty programmes see 20–40% of issued rewards redeemed. A lower redemption rate lowers your cost but usually means weaker repeat-visit lift, so model both together rather than optimising one in isolation.

Free tool

Loyalty & discount ROI simulator

Model whether a discount or points programme pays for itself, given your basket size, volume, and the repeat-visit lift it drives.

CurrencyAverage basketUSDMonthly transactionsDiscount / points rate%Redemption rate%Share of transactions that use the offerRepeat-visit uplift%Extra transactions the offer drivesGross margin%To value incremental sales as profit

Monthly discount cost

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Incremental revenue

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Incremental gross profit

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Net monthly return

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An estimate: discount cost = redeeming transactions × basket × rate; incremental profit = extra transactions × basket × margin. Real results depend on how much lift the offer actually drives.

How it works

1
Enter your baseline
Average basket value and monthly transactions describe your shop today.
2
Describe the offer
Set the discount or points rate, the share of customers who redeem, and the repeat-visit uplift you expect.
3
Read the net return
The tool shows the monthly discount cost, the incremental revenue, and whether the offer is net-positive.

Frequently asked

How do I know if a discount is worth it?: Compare the cost of the discount (rate × redeemed volume) against the incremental gross profit from the extra visits it drives. If incremental profit exceeds the discount cost, the offer pays for itself. This tool estimates both sides so you can see the net.
What is a good redemption rate for a loyalty programme?: It varies widely, but many retail loyalty programmes see 20–40% of issued rewards redeemed. A lower redemption rate lowers your cost but usually means weaker repeat-visit lift, so model both together rather than optimising one in isolation.

Run the real thing, not just the math.

RetailPOS applies these rates at the counter automatically — tax, margins, loyalty and FBR invoicing built in. Free until your first 100 sales.

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