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Tiered / Bulk Pricing Calculator

Graduated against volume tier pricing on the same schedule. Volume pricing creates a cliff at every break where buying one more unit lowers the total bill, which graduated pricing never does.

Also called: volume discount calculator, graduated pricing.

$
$
$
Pricing mode
Total price
$75,250.00

$75,250.00 for 850 units, an effective rate of $88.53 each. On the other mode it would be $72,250.00, a difference of $3,000.00. Graduated pricing has no cliff: one more unit always costs more in total.

Effective price per unit
$88.53
On the other mode
$72,250.00
Difference between modes
$3,000.00
Charged in the first tier
$20,000.00
Charged in the second tier
$55,250.00
Charged beyond
$0.00
On the cliff
Graduated pricing has no cliff: one more unit always costs more in total.
How this is calculated
Method and background

How this is calculated

Graduated pricing charges each band at its own rate, the way an income tax slab works. Volume pricing finds the tier the total quantity falls in and applies that single rate to everything, which means crossing a break can make the whole order cheaper. That cliff is a real problem: customers game it, and one unit either side of a break can differ by thousands. Graduated pricing has no such discontinuity.

graduated prices each band separately; volume applies one rate to everything, which creates a cliff at each break
u
Units
L
Tier limits

Worked examples

Each of these is asserted on every build. If a change to the engine ever moved one of these answers, the build would fail before the page could print it.

850 units on graduated pricing

Units purchased
850
Price per unit up to the first break
$100.00
First break at
200
Price per unit to the second break
$85.00
Second break at
1,000
Price per unit beyond
$70.00
Pricing mode
Graduated, each tier priced separately

Total price$75,250.00

200 at 100 plus 650 at 85

Open this example

the same units on volume pricing

Units purchased
850
Price per unit up to the first break
$100.00
First break at
200
Price per unit to the second break
$85.00
Second break at
1,000
Price per unit beyond
$70.00
Pricing mode
Volume, one rate on everything

Total price$72,250.00

boundary: 850 at a single rate of 85

Open this example

Method and limits

What it assumes

  • Three tiers with the breaks you supply.

What it deliberately does not model

  • Real schedules often mix modes or add minimum commitments.

Formula version 1.0.0 · definition 1.0.0 · United States · Report a problem with this calculator

Frequently asked questions

Which mode should I use?
Graduated, unless you specifically want the cliff as an incentive to buy more. Volume pricing means some customers pay less for buying more, which is hard to explain and easy to exploit.