How to compare discounts and deals

Sales are designed to make you feel like you are winning. A bit of arithmetic helps you see whether you actually are.

Stacked discounts multiply

If a store takes 20% off and then you use a 10% coupon, the coupon applies to the already-reduced price. On a $100 item: $100 × 0.80 = $80, then $80 × 0.90 = $72. The total saving is 28%, not 30%. The order does not matter, but the percentages never simply add.

Offer	Maths	You pay	Real saving
20% off	100 × 0.80	$80	20%
20% then 10%	100 × 0.80 × 0.90	$72	28%
30% off	100 × 0.70	$70	30%
$25 off $100	100 - 25	$75	25%

Money-off versus percent-off

$25 off sounds different from 25% off, but on a $100 item they are the same. They diverge on other prices: $25 off a $40 item is 62.5% off, while 25% off a $40 item is $10. Always convert to the final price you will pay.

Buy one, get one

"Buy one, get one half price" is 25% off when you buy two. "Buy one, get one free" is 50% off. "Buy 3 for the price of 2" is about 33% off. Only a bargain if you wanted the extras anyway.

Compare the unit price

Bigger packs are not always cheaper per unit. Divide price by quantity or weight. A 500 g box at $3.00 is $0.60 per 100 g. A 750 g box at $4.20 is $0.56 per 100 g, which is the better deal if you will use it all.

Do not forget tax and shipping

Tax is normally added after discounts. Free-shipping thresholds can tempt you to add items you did not need, so compare the cost of the extra items with the shipping you would save.

Is the "original price" real?

A big percentage off a price that was recently raised is not much of a saving. If you can, compare with what other shops charge for the same item.

A quick routine

1. Work out the final price after all discounts.
2. Add tax and shipping.
3. Compare with one other option, per unit if possible.
4. Ask whether you would buy it at this price without the sale sign.