Black Friday Discounts: How Deep Can You Go Before You Lose Money?

Black Friday 2026 falls on November 27, with Cyber Monday on November 30. Adobe expects US shoppers to spend $12.9 billion online on Black Friday alone this year, up 9.2%, inside a $47.5 billion Cyber Week. For a small shop that is the biggest week of the year to be found by new buyers — and the easiest week to sell more than ever and keep less than usual.

The reason is arithmetic, not bad luck. A discount comes straight out of your margin, so every order at 25% off earns far less than a full-price one. The question is never "will a discount bring more orders?" — it will. The question is how many more orders the discount has to bring just to stand still. This guide works it out for a real-looking shop, with marketplace fees and ad costs included, so you can set a Black Friday price you will not regret in January.

The one formulaHow many extra orders a discount needs

Start without fees, to see the shape. If your gross margin is m (what is left of the price after the cost of the product) and you cut the price by d, the margin per order drops from m to m − d. To earn the same total, you need:

That is the whole idea. Here it is across the margins small shops actually run on:

Two things jump out. First, the cost of a discount is not linear: going from 20% to 40% off does not double the extra orders you need, it multiplies them three to six times. Second, a shop reselling goods at a 30% margin cannot run a 30% sale at all — there is nothing left to give.

The fees you forgotWhy marketplace sellers need even more

Marketplace and payment fees are charged on the price the buyer pays, so they shrink with the discount — but the fixed per-order part does not. On Etsy in the US, the seller pays a 6.5% transaction fee, 3% + $0.25 payment processing, and a $0.20 listing fee that renews when a multi-quantity listing sells, according to Etsy's own fee pages. Run the same grid for a $40 item with those fees:

Fees turn a 50% margin into roughly 39% of the price actually kept, and that is what the discount eats into. For the 30% margin shop, a 20% sale needs fifteen times its normal orders. The same logic applies to Amazon referral fees, Shopify Payments or a card terminal in a physical store; only the percentages change. If you sell on Etsy and invoice wholesale customers too, our breakdown of PayPal invoice fees shows how the same percentage-plus-fixed structure eats into smaller orders.

A worked exampleOne candle shop, four Black Friday plans

Take a shop selling a $40 candle on Etsy. Wax, jar, wick, label and box cost $13. In a normal late-November week it sells 120 candles, which leaves $22.75 per order after Etsy's fees — $2,730 a week to pay for the owner's time, rent, equipment and everything else.

The third row is the one that catches people out. A 25% sale on its own needs two-thirds more orders, which a good Black Friday can deliver. Add a modest $4 per order in ads to promote it, and the shop has to more than double its week just to earn what it would have earned doing nothing. At 35% off with ads, it needs nearly four times its normal volume — and it has to make, pack and ship 450 candles to get there.

There is also a hard floor. With no ads, this shop loses money on every order beyond 62.8% off; with $4 of ads per order, beyond 51.8% off. Those are not targets — they are the points where selling more makes you poorer.

Smarter offersDiscounts that cost less than a percentage

A storewide percentage is the most expensive way to say "sale". The same shop can make an attractive offer for much less:

• A free gift is valued by the buyer at its price and costs you only what it takes to make. A $3 wax melt "worth $8" feels generous and needs 16% more orders, not 67%.
• A spend threshold ("$5 off when you buy two") lifts the order size, and the discount is spread across a bigger basket. Its effective discount here is just 6.3%.
• A bundle discounts the second item, not the first, and moves more stock per shipment — so postage and packaging per candle fall too.
• Early access for past customers or newsletter subscribers costs nothing in margin and rewards the people most likely to buy anyway.

Shoppers are trained to compare percentages, and Adobe's data show the big retailers peaking at around 30% off in electronics and toys and about 23% in apparel this season. A small shop does not need to match that number; it needs an offer its customers notice. The shopper's side of the same question — how to tell a real deal from a badge — is in our guide to Prime Big Deal Days deal math.

Before you set the priceA five-minute checklist

The Break-Even Calculator answers the first two questions for any product: enter the discounted price, the cost per unit and the week's fixed costs, and it returns the orders needed to break even and to hit a target profit. The E-commerce Profit Calculator does the per-order version with platform fees, payment fees, shipping, returns and ad spend per order, and shows the break-even price and the most you can spend on ads.

For the stock side, the Inventory Tracker keeps on-hand quantities as the sum of every movement, so you can see whether there is enough wax and jars for 280 orders before you promise them.

The week afterMeasuring whether it worked

Revenue will look great on December 1 — that is the trap. What tells you whether Black Friday paid is the week's profit compared with a normal week, after fees, product costs and ads.

In the Business P&L Tracker, log the week's sales by channel with the fees the platform kept, the product costs and the ad spend. Its ladder shows gross margin and operating margin for the period and compares them with the period before, and the Products view shows profit per product after fees — so you can see which item the discount actually paid off on, and which one you sold at a loss. If you are also deciding what to charge in the first place, our guide on what to charge as a freelancer walks through building a price from costs up rather than from competitors down.

If prices for your materials moved this year — tariffs on imported jars, wicks or packaging, for example — use this year's cost, not last year's. Our explainer on IEEPA tariff refunds for small businesses shows how import costs flow into the cost of goods.

FAQBlack Friday discounts for small shops

When is Black Friday 2026? Friday, November 27, 2026, the day after Thanksgiving (November 26). Cyber Monday is November 30. Adobe's Cyber Week counts the five days from Thanksgiving to Cyber Monday.

What is a good Black Friday discount for a small business? One your margin can carry. At a 50% gross margin, 10–15% off needs 25–43% more orders before fees; 30% off needs two and a half times your normal orders. Many small shops do better with a gift, a bundle or a spend threshold than with a storewide percentage.

How do I calculate how many more sales I need with a discount? Divide your margin by your margin minus the discount: margin ÷ (margin − discount). With fees, use the amount you keep per order at full price divided by the amount you keep at the discounted price.

Should I include ad costs? Yes. Divide what you will spend promoting the sale by the orders you expect from it and subtract that per order. In the example above, $4 of ads per order turned a 25% sale from needing 67% more orders into needing 135% more.

Is markup the same as margin? No. Markup is profit as a share of cost; margin is profit as a share of price. A 100% markup is a 50% margin. Use margin for discount math — the discount is taken off the price.

Where these numbers come fromMethod and sources

• Dates: Thanksgiving 2026 is the fourth Thursday of November (November 26), so Black Friday is November 27 and Cyber Monday November 30.
• Market figures: Adobe Digital Insights, US online spending. The 2026 forecast (published September 28, 2026): $275.1 billion for November–December, Cyber Week $47.5 billion, Black Friday $12.9 billion, Cyber Monday $15.1 billion, peak discounts of 30% for electronics, 29% toys, 23% apparel. The 2025 actuals (published January 7, 2026): Black Friday $11.8 billion (+9.1%), Cyber Monday $14.25 billion, Cyber Week $44.2 billion. Shopify reported $14.6 billion in Black Friday–Cyber Monday sales by its merchants in 2025, up 27%.
• Etsy fees: Etsy Help's fee pages — 6.5% transaction fee on the order total, 3% + $0.25 payment processing (US; varies by country) and a $0.20 listing fee. Offsite Ads fees are not included and would raise the required volume further on the orders they bring.
• Calculations: all tables are computed in a small script (drafts/black-friday-break-even-numbers.mjs). Amount kept per order = price × (1 − discount) × (1 − 9.5%) − $0.45 − product cost − ads per order. Orders needed = (amount kept at full price × normal orders) ÷ amount kept at the discount.
• What the model leaves out, and which way that biases it: it assumes the discount brings only new orders. In reality some buyers would have bought at full price anyway, which makes discounts more expensive than shown. It also ignores repeat purchases from new customers, which can make a sale worth more than one week's profit — a reason to measure customers who come back, not to discount deeper. The candle shop is illustrative, not a real business.