A quantity discount is an incentive offered to a buyer that results in a decreased cost per unit of goods or materials when purchased in greater numbers. A quantity discount is often offered by sellers to entice customers to purchase in larger quantities.

What are the purposes of quantity discount?

One important objective of quantity discounts is to reduce the number of small orders and thereby avoid the high cost of servicing them. Quantity discounts can facilitate economic size orders in three ways: 1. A given set of customers is encouraged to buy the same quantity but in bigger lots.

How do you find the quantity discount?

Calculate the quantity discount. Multiply the number of widgets purchased by the discount associated with purchasing that number of widgets. Then multiply this number by the price of each widget.