Free tool
Discount or a larger commitment?
A supplier offers a lower unit price, but with an annual minimum. Enter your own numbers and check whether you really spend less or simply buy more.
Result for one year
| Current expenditure | 100,000 EUR |
|---|---|
| New expenditure | 108,000 EUR |
| Difference | +8,000 EUR |
| Excess above need | 200 units |
The new offer requires 8,000 EUR more that year.
Threshold: at a need of 1,080 units the expenditure is equal. Below that, the new offer means higher expenditure.
What this calculation does not show
- Excess stock is not automatically a loss: it may be usable later. Assess its value, shelf life and holding cost separately.
- Tax, finance, storage and payment-timing differences are not included.
- The threshold is a purchase-expenditure threshold, not an overall profitability threshold.
- Exclusivity, exit conditions and the reliability of the demand forecast often change the decision more than the price itself.
Seven checks before you accept an offer like this:
Before You Say YES →Is the decision bigger than one calculation?
If the offer includes exclusivity, a longer contract or dependence on one supplier, describe the situation in a few sentences.
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