Editing Discounts and allowances (section)

{{Short description|Reductions applied to the basic sale price of goods or services}}
{{about|reductions applied to the basic sale price|for other uses|Discount (disambiguation)}}
{{redirect|Senior Discount|the band|Senior Discount (band)}}
{{More citations needed|date=February 2010}}
'''Discounts''' are reductions applied to the basic sale [[price]] of goods or services. '''Allowances against price''' may have a similar effect

Discounting practices operate within both business-to-business and business-to-consumer contexts.<ref name=conj>Iyengar, R. and Jedidi, K., [https://www.jstor.org/stable/pdf/41488026.pdf A Conjoint Model of Quantity Discounts], ''Marketing Science'', Volume. 31, No. 2, March–April 2012, pp 334-350, {{JSTOR|41488026}}, accessed on 21 January 2025</ref> Discounts can occur anywhere in the [[distribution channel]], modifying either the manufacturer's [[list price]] (determined by the manufacturer and often printed on the package), the retail price (set by the [[retail]]er and often attached to the [[product (business)|product]] with a sticker), or a quoted price specific to a potential buyer, often given in written form.

There are many purposes for [[discounting]], including to increase short-term [[sales]], to move out-of-date stock, to reward valuable customers, to encourage [[distribution (business)|distribution channel]] members to perform a function, or to otherwise reward behaviors that benefit the discount issuer. Some discounts and allowances are forms of [[sales promotion]]. Many are [[price discrimination]] methods that allow the seller to capture some of the [[consumer surplus]].