How is a cumulative quantity discount generally structured?

A cumulative quantity discount is structured to reward customers for their total purchases over a specified period rather than just a single transaction. This approach encourages repeat business and fosters loyalty, as customers who make multiple purchases are able to receive discounts that accumulate over time.

For example, if a customer buys certain quantities of a product each month, the discount may increase as the total amount purchased over those months reaches specific thresholds. This model is beneficial for both the buyer, who saves money, and the seller, who secures ongoing sales and strengthens customer relationships.

On the other hand, concepts like bulk purchases or single purchase order discounts apply to very specific transactions and do not take into account overall purchasing behavior over time, limiting their impact on customer loyalty and sales volume. Similarly, irregular percentage discounts do not create a systematic incentive to accumulate purchases, thereby failing to drive long-term customer engagement.