What discount to give, and how to know if it is costing you
A discount comes out of your margin, not your bill. The gap between those two is wider than it looks.
Short answer: 10%. That is what almost every CalVal partner restaurant chooses. But check what that number costs your margin, not your bill. They are not the same figure, and the gap is wider than it looks.
A discount does not come out of the bill
This is the mistake that makes a discount far more expensive than it looks: it gets worked out against the selling price, when it actually comes out of the margin.
A 10% discount on the price is not a 10% drop in margin.
Take a dish at 20 euros whose ingredients cost you 6. Your gross margin is 14 euros, or 70%.
A 10% discount takes 2 euros off the customer's bill. Those 2 euros do not come out of the 20, they come out of the 14. You are not losing 10% of something, you are losing 14% of your margin on that dish.
Table: what a discount costs your margin
The same 20 euro dish, with 6 euros of ingredients, so 14 euros of margin.
| Headline discount | Off the bill | Margin left | Share of margin lost |
|---|---|---|---|
| 5% | 1.00 EUR | 13.00 EUR | 7% |
| 10% | 2.00 EUR | 12.00 EUR | 14% |
| 15% | 3.00 EUR | 11.00 EUR | 21% |
| 20% | 4.00 EUR | 10.00 EUR | 29% |
The heavier your food cost, the wider the gap. On a 20 euro dish whose ingredients cost 10, the margin is only 10 euros, and the same 2 euro discount takes 20% of it instead of 14.
The shortcut, for your own menu: divide the discount by your margin rate. A 10% discount at 70% margin costs roughly 14% of margin. At 50% margin, it costs 20%.
The threshold that matters
A discount is not a loss. It is a purchase: you are buying a visit.
It pays for itself if the customer would not have come without it, or if they come back afterwards at full price. It costs you money if they would have come anyway, because you have then paid for a visit you already had.
Which makes the deciding question not "how much to give" but who are you giving it to?
A discount in the window mostly reaches your regulars, the people already walking past. A discount reserved for someone who does not know you yet buys a visit you would not otherwise have had. The percentage is identical. What you get back is not remotely the same.
Some markers
| Discount | What it does in practice |
|---|---|
| Under 10% | Barely noticed. Shaves the bill of people who had already decided |
| 10 to 15% | The usual ground. Visible enough to weigh, contained enough to bear |
| Over 20% | Check dish by dish. At 50% margin, a 20% discount eats 40 of it |
| Partial | Exclude the low-margin lines rather than lowering the percentage |
These are markers drawn from what CalVal partners actually do, not a rule of the trade. Almost all of them use 10%.
Whole menu, or part of it?
Nothing obliges you to apply it everywhere, and a partial discount is often the better setting.
Drinks are the obvious case: their margin is nothing like a dish's, and excluding them changes what the offer costs without taking anything away from how attractive it looks. Someone coming for a discount on their main course is not counting their coffee.
The reverse works too. If one dish earns you more than the others, putting only that one in the offer steers the order towards it.
At CalVal this is a switch in your partner account: the discount covers the whole menu, or the part you decide.
VAT and discounts
A discount reduces the price actually taken, and therefore the base VAT is owed on. The detail depends on when the discount is applied and how your till records it, and that is not something to improvise in a guide.
Ask your accountant. The official reference is the BOFiP on the VAT taxable base. CalVal does not give tax advice and is not in a position to.
What you need to be able to do
Whatever number you land on, two things matter more than the number.
Change it. Your costs move, your menu changes, one month is not the next. A discount you cannot alter without ringing someone is a discount you will never adjust.
Pause it. If it is bringing you nothing, you need to be able to stop the day you decide, without notice and without a negotiation.
At CalVal the percentage is yours, you choose whether it covers the whole menu or part of it, you change it from your partner account, and a switch takes your restaurant out of the app whenever you want. Signing up costs nothing: no subscription, no commission on your sales. The discount stays the only cost, and you are the one who writes it.