The Main Types of Shopify Wholesale Discounts and Promotions!

As a Shopify store owner, you know the struggle of moving slow-selling inventory and attracting bulk buyers. But what if you could turn this challenge into an opportunity? Shopify’s wholesale discounts and promotions are key. Implementing wholesale discounts and promotions strategies can significantly boost sales, attract bulk buyers to your Shopify store, and clear out inventory faster.

Shopify wholesale discounts and promotions are special pricing strategies that allow merchants to offer bulk buyers lower prices based on order quantity. These discounts can be set up using built-in Shopify features or third-party apps to encourage larger purchases, boost sales, and improve customer loyalty.

According to Statista, Applying a Shopify wholesale discount can be a game-changer for your e-commerce business. This strategy is designed for large orders, particularly in the B2B sector, a massive $12.2 trillion market in 2019.

In this guide, we’ll walk through how to create Shopify wholesale discounts and promotions, the 2 main types of Shopify wholesale discounts, and how to calculate wholesale deals, and introduce you to the best Shopify automatic discount app to manage your discount strategy.

Let’s dig in.

Summary

• Wholesale discounts help attract bulk buyers and move inventory faster.
• Shopify supports wholesale pricing through built-in tools and discount apps.
• The two main discount types are quantity discounts and tiered pricing.
• Correct pricing requires knowing costs, margins, and buyer demand.
• Wholesale promotions boost sales but must be planned to protect profit.

How Do You Create Shopify Wholesale Discounts and Promotions?

Offering discounts and promotions for your wholesale customers and order management on Shopify, there are two main ways to do it: Shopify’s built-in features and Shopify apps. 

Here’s a detailed look at both options:

• Shopify’s Built-in Features for Wholesale Discounts and Promotions
• Using Shopify Apps for Wholesale Discounts and Promotions

Shopify’s Built-in Features for Wholesale Discounts and Promotions

Shopify provides built-in tools to help merchants create wholesale discounts without needing third-party apps. These features work best for businesses using Shopify Plus or handling small-scale wholesale orders.

• Shopify Plus Wholesale Channel
• How Do You Set Up Shopify Plus Wholesale Discounts?
• Shopify Discount Codes for Wholesale
• Steps to Create a Wholesale Discount Code

Shopify Plus Wholesale Channel

If you’re using Shopify Plus, you can create a dedicated Wholesale Channel, which allows you to:

•  Offer custom pricing for wholesale customers
•  Set discounted rates for bulk purchases
•  Restrict access to wholesale-only customers
•  Use net payment terms
  

How Do You Set Up Shopify Plus Wholesale Discounts?

• Go to your Shopify Admin and navigate to Wholesale Channel
• Create a price list with different pricing tiers based on order quantities.
• Assign these price lists to your wholesale customers.
• Share a password-protected storefront where wholesalers can log in and access their discounts.

Shopify Discount Codes for Wholesale

Even if you’re not using Shopify Plus, you can still offer wholesale discounts using Shopify’s discount codes feature.

Steps to Create a Wholesale Discount Code

1. Go to your Shopify Admin > Discounts.
2. Click Create Discount and choose a discount type:
3. Percentage discount 
4. Fixed amount discount 
5. Buy X, Get Y 
6. Set a minimum order quantity if required 
7. Apply restrictions to make the discount only available to wholesale customers.
8. Share the discount code with your wholesale buyers.
   

Using Shopify Apps for Wholesale Discounts and Promotions

If Shopify’s built-in features fail to meet your needs, you can use third-party discount apps to automate and customize your wholesale pricing. These apps offer more flexibility, advanced pricing rules, and better customer segmentation.

Below, we’ve explained a best Shopify automatic discount app to solve your wholesale discount and promotion issue and boost your sales. 

• DiscountRay- Shopify Discount App
• Main Features of DiscountRay
  

DiscountRay- Shopify Discount App

DiscountRay allows merchants to create and offer discounts to their potential customers.

Main Features of DiscountRay

• Quantity Discounts
• Different Discounts on Different Variants
• Variants Fixed Price
• Schedule Discount
• Discount for B2B Customers
• Display Style
  

Quantity Discounts

By using the quantity or volume discount feature, you can easily apply discounts per variant to encourage large-quantity purchases, thus increasing your sales.

Different Discounts on Different Variants

You can set discounts differently for specific products, tags, customers, types of products, or collections using this feature. 

Variants Fixed Price

With the variants’ fixed price, you can manually set quantity-based discounted prices for each variant to match different order sizes. You can apply individual discounts by using this feature.

Not clear yet? Watch our detailed guide on how to apply variants discounted prices in Shopify.

Schedule Discount

Scheduling discounts is one of the most useful things for Shopify merchants. You can save time by scheduling your discounts at your preferred time for special days, occasions, etc.

Discount for B2B Customers

You can restrict discounts only to B2B customers. The discount can be assigned by Customer tag or Specific customers. Targeting the loyal customers is now one click away.

Display Style

Customize your store view as per your taste. You can choose the product view from our display style feature, list, or table view—whatever suits your store most.

The Main Two Types of Shopify Wholesale Discounts

Offering wholesale discounts in your Shopify store can be executed through two primary strategies: Quantity (Volume) Discounts and Tiered Pricing. Both methods encourage larger purchases by providing customers with cost savings. Here’s a straightforward explanation of each:

• Quantity/Volume Discounts
• Tiered Pricing

Type#01: Quantity (Volume) Discounts

This strategy offers customers a discount when they purchase a certain number of the same product. The more they buy, the more they save on each item. 

For example:

• Buy 5 items, get 10% off each
• Buy 10 items, get 15% off each

This approach is simple and directly rewards customers for buying in bulk. 

Type#02: Tiered Pricing

Tiered pricing sets different price levels based on the quantity purchased, with discounts increasing as customers reach higher tiers. For instance:

• 1-5 units: $20 each
• 6-10 units: $18 each
• 11+ units: $16 each

This method encourages customers to buy more to reach the next discount level, benefiting both the customer and the business.

How to Calculate Shopify Wholesale Discounts and Promotions?

Calculating wholesale discounts and promotions in your Shopify store involves setting prices that are attractive to bulk buyers while ensuring your business remains profitable. 

Here’s a step-by-step guide to help you navigate this process:

• Understand Your Market
• Determine Your Production Cost
• Set Your Desired Profit Margin
• Calculate the Wholesale Price
• Establish your retail pricing
• Implement Quantity-based discounts
• Utilize Shopify tools for discounts
• Regularly review and adjust pricing

Understand Your Market

Begin by researching your target audience and competitors. Identify where your products fit in the market—are they budget-friendly, mid-range, or premium? Understanding this helps you align your pricing strategy with customer expectations and market standards. 

Determine Your Production Costs

Calculate the total cost to produce each product. 

This includes:

1. Material Costs: Expenses for raw materials.
2. Labor Costs: Wages paid to workers involved in production.
3. Overhead Costs: Additional expenses like utilities, equipment maintenance, and shipping.
4. Summing these gives you the Cost of Goods Manufactured (COGM).

Set Your Desired Profit Margin

Decide on the profit margin you aim to achieve for wholesale transactions. Wholesale profit margins typically range between 15% and 50%, depending on the industry and product. A common practice is to ensure your wholesale price is at least double your production cost, securing a 50% margin.

Calculate the Wholesale Price

Use the following formula:

1. Wholesale Price = COGM + (COGM × Desired Profit Margin)
2. For example, if your COGM is $20 and you desire a 40% profit margin:
3. Wholesale Price = $20 + ($20 × 0.40) = $20 + $8 = $28

Establish Retail Pricing

Retailers purchasing your products will add their markup to determine the selling price to consumers. To maintain consistency and competitiveness, consider suggesting a retail price using:

Retail Price = Wholesale Price ÷ (1 – Retailer’s Desired Profit Margin)

If the retailer desires a 50% margin:

Retail Price = $28 ÷ (1 – 0.50) = $28 ÷ 0.50 = $56

Implement Quantity-Based Discounts

Encourage larger orders by offering tiered discounts. 

For Example:

1. Order 10-49 units: 5% discount
2. Order 50-99 units: 10% discount
3. Order 100+ units: 15% discount

These incentives can boost sales volume and strengthen relationships with wholesale customers.

Utilize Shopify’s Tools for Discounts

Shopify offers built-in features and apps to manage wholesale pricing.

Built-In Discounts

Create discounts based on order quantity or purchase amount directly in your Shopify admin panel.

Third-Party Apps

For advanced features like automatic tiered pricing and customer-specific discounts, consider apps such as Wholesale Pricing Discount. This app allows for personalized pricing strategies and integrates seamlessly with your Shopify store.

Regularly Review and Adjust Pricing

Market conditions, production costs, and customer preferences can change. Regularly assess your pricing strategy to ensure it remains competitive and profitable. Adjust discounts and promotions as needed to align with your business goals and market dynamics.

What are the Pros and Cons of Wholesale Discounts and Promotions?

Offering wholesale discounts and promotions on Shopify can be a great way to increase sales, attract bulk buyers, and build long-term relationships with wholesale customers. However, as well as its advantages, it also comes with some challenges.

Let’s break it down:

Pros of Shopify Wholesale Discounts and Promotions

• Attract more wholesale buyers.
• Encourages larger purchases
• Helps build long-term customer relationship
• Competitive advantage in the market
• Easier inventory management
• Automated discounts with Shopify discount apps

Attracts More Wholesale Buyers

Wholesale discounts make your store more appealing to bulk buyers who want to purchase in large quantities at a lower cost. When buyers see attractive discounts, they are more likely to place higher-value orders, boosting their sales volume.

Encourages Larger Purchases

With quantity-based discounts or tiered pricing, customers are incentivized to buy more to save more. For example, if a store offers:

• Buy 10+ items – Get 10% off
• Buy 20+ items – Get 15% off

Customers are more likely to increase their order size to reach the next discount level, leading to higher revenue per transaction.

Helps Build Long-Term Customer Relationships

Offering special discounts to repeat wholesale buyers can help build VIP customer loyalty in eCommerce. When businesses see that they can consistently get better pricing from your store, they are more likely to continue buying from you rather than switching to competitors.

Competitive Advantage in the Market

If your competitors are not offering wholesale discounts, you gain an edge by providing better pricing options. Even if competitors have similar products, your discounted bulk pricing can attract more B2B customers to your Shopify store.

Easier Inventory Management

Wholesale discount pricing encourages bulk sales, helping you move inventory faster. This is especially useful if you have seasonal products or excess stock that you want to sell before launching new collections.

Automated Discounting with Shopify Apps

Shopify allows merchants to automate wholesale pricing and discounts through built-in tools and third-party apps. This means you don’t have to manually apply discounts for each order—everything can be set up to run smoothly and efficiently.

Cons of Shopify Wholesale Discounts and Promotions

• Lower profit margin
• Devaluation of products
• Complicated pricing management
• Risk of fraud or misuse
• May not work for all business models

Lower Profit Margins

While discounts increase sales volume, they also reduce profit per unit. If not carefully planned, you could end up selling large amounts of products at a price too low to be profitable.

Solution 

Always calculate your costs and profit margins before setting up discounts. 

Make sure that even with bulk discounts, you’re still making a healthy profit.

Potential Devaluation of Products

Frequent or heavy discounts can harm your brand’s perceived value. If customers get used to always receiving discounts, they may hesitate to buy at full price, making it harder to sell at standard rates.

Solution

Use discounts strategically—offer them only for wholesale buyers or during special promotions instead of all the time.

Complicated Pricing Management

Managing different discount levels, customer groups, and pricing structures can become complex, especially if you have many products and customers.

Solution

Use Shopify’s Wholesale discount Pricing Apps (like DiscountRay, Wholesale Club, or Bold Custom Pricing) to automate and manage different pricing levels efficiently.

Risk of Fraud or Misuse

Some retail customers may try to take advantage of wholesale discounts by pretending to be wholesale buyers. This could lead to lost revenue if individuals buy at lower wholesale prices and resell for profit.

Solution 

Use customer verification methods, such as requiring a business tax ID or minimum purchase requirements for wholesale pricing access.

 May Not Work for All Business Models

Not every Shopify store is suited for wholesale pricing. If you sell custom, handmade, or luxury products, offering wholesale discounts may reduce exclusivity and harm your brand image.

Solution

If your products are high-end, consider offering exclusive deals instead of deep wholesale discounts.

Wrapping Up

Finally, Shopify wholesale discounts and promotions isn’t just about offering discounts—it’s about smart pricing that maximizes sales while maintaining profitability. It can boost sales, attract bulk buyers, and help clear inventory, but they need to be carefully planned to avoid hurting profit margins and brand value. If used strategically, they can be a powerful tool for business growth on Shopify.

Moreover, you can get help from the Shopify discount app mentioned above and offer your discounts or promotions accordingly to maintain your ground value.

FAQs