Volume Discount
Quick answer
A price reduction granted when quantity thresholds are exceeded, to encourage larger orders.
Key takeaways
- Threshold (whole volume at the reached-threshold price)
- Tiered (per bracket)
- Period-based (cumulative rebate at month/quarter end)
What a volume discount is
Volume discount is the reduction applied automatically when the ordered quantity exceeds a threshold (e.g. -3% above 100 units, -6% above 500). It encourages larger orders and builds B2B loyalty.
Why it matters
Volume discounts increase basket value, but poorly managed they can erode margin or push the customer to overstock. They must be tied to real cost (EOQ) and target margin.
Types
- Threshold (whole volume at the reached-threshold price)
- Tiered (per bracket)
- Period-based (cumulative rebate at month/quarter end)
How CRMconnect helps
CRMconnect applies volume-discount grids and contract prices automatically in the B2B portal, computing the correct price per customer and quantity, without manual lists or pricing errors.
Real-world example
A distributor managed volume discounts manually, with frequent pricing errors. The automatic grid in the CRMconnect B2B portal removed errors and raised average order value by 14%.
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Frequently asked
Volume discount vs contract price?+
The contract price is negotiated fixed per customer; the volume discount applies additionally on quantity. Both can coexist in the same grid.
How do I avoid margin erosion?+
By tying discount thresholds to real cost (landed cost, EOQ) and target margin, not just the desire to sell more.
Where CRMconnect fits
Related terms
Contract pricing
Individually negotiated per-customer B2B prices, different from list price, applied automatically at order time.
B2B commerceMOQ (Minimum Order Quantity)
The minimum quantity a supplier accepts per order - a factor that directly affects inventory levels, cash flow and unit cost.
B2B commercePersonalised B2B catalogue
Assortment and product content displayed differently per customer, by contract, region or segment.
OperationsEconomic Order Quantity (EOQ)
The optimal order quantity that minimises the combined total of ordering and holding costs.