What the Sale Price Actually Is
A discount looks simple until there are two of them, or a tax on top, or a percentage off a price that was already reduced. That is when mental arithmetic starts producing numbers that are close but wrong, and close is not much use when you are deciding whether something is worth buying.
This calculator gives the final price, the amount saved and the effective discount, so you can compare offers that are presented in different forms.
How to Calculate a Discount
Two numbers give you the answer; the third field is where most of the confusion lives.
- Enter the original price as marked.
- Enter the discount percentage. Read the sign carefully, "up to 50% off" usually means one item in the shop is half price and the rest are not.
- Read the final price and the amount saved. The saving is what to compare against, since a large percentage off a small price is a small saving.
- For a second discount, apply it to the result rather than adding the percentages together. Two 20% discounts are not 40%.
- Add tax afterwards if it is not included, applying it to the discounted price rather than the original.
Why Stacked Discounts Are Not Additive
Taking 20% off and then another 20% does not give 40% off. The second discount applies to the already-reduced price, so 100 becomes 80 and then 64, an effective discount of 36%, not 40. The gap widens as the percentages grow: two 50% discounts give 75% off, not 100%.
This matters for reading offers. "Extra 20% off sale items" sounds like it should add to the sale discount and does not. Working out the effective rate is the only way to compare that against a flat discount elsewhere, and the flat one is often better than it looks.
Stacked Discounts, Actual Effect
What two discounts really come to when the second applies to the reduced price.
| First | Second | Sounds like | Actually is |
|---|---|---|---|
| 10% | 10% | 20% | 19% |
| 20% | 10% | 30% | 28% |
| 20% | 20% | 40% | 36% |
| 30% | 20% | 50% | 44% |
| 50% | 20% | 70% | 60% |
| 50% | 50% | 100% | 75% |
The order does not matter, 20% then 30% gives the same result as 30% then 20%, which is worth knowing when a shop applies them in a sequence you did not expect.
Reference Prices and What They Mean
A percentage is only as meaningful as the price it is taken from. A discount from an inflated "recommended retail price" can leave the item costing more than a competitor charges at full price, which is why the final figure matters more than the percentage. Comparing what you would actually pay across sellers is the only reliable check.
Many jurisdictions regulate this. EU rules require a price reduction to be shown against the lowest price used in the previous thirty days, and the UK and several other countries have comparable requirements. Where those rules apply, a reference price should reflect something the item genuinely sold at rather than a number chosen to make the discount look larger.
It is also worth separating the discount from the decision. A 70% reduction on something you were not going to buy saves nothing at all; it spends the remaining 30%. The question a percentage cannot answer is whether you wanted the item at the price you would actually pay, and that is the only one that decides whether the purchase was a good idea.