How To Customize Discount Rates in Sage 50

Offering discounts is one of the most common ways businesses incentivize customers, manage inventory, and improve cash flow. Whether it’s a promotional discount, a customer loyalty incentive, or a volume-based price reduction, applying the right discount at the right time can make a noticeable difference in your profitability and client satisfaction.

Sage 50 Accounting, formerly known as Peachtree, gives you flexible options to manage and apply discounts in your sales process. However, the ability to customize discount rates effectively depends on how well you understand Sage 50’s features for both customer-level and transaction-level discounts.

This comprehensive guide will walk you through the steps and strategies to customize, apply, and manage discount rates in Sage 50, covering:

• Types of discounts you can use
• Setting up default customer discounts
• Applying discounts to inventory items
• Using discount fields in sales transactions
• Adjusting forms to show discounts
• Best practices for managing discounts
• Common mistakes to avoid

Types of Discounts in Sage 50

Sage 50 supports two main categories of discounts:

1. Customer-Level Discounts

These are predefined percentages assigned to a customer, which automatically apply when you create invoices or sales orders for that customer. They’re ideal for long-term relationships, loyalty rewards, or negotiated pricing terms.

2. Transaction-Level Discounts

These are entered manually during the creation of invoices or sales orders. They offer more flexibility, allowing you to apply a discount on a specific sale, line item, or overall invoice total.

Understanding the difference between these two types is key to setting up your Sage 50 system correctly.

Step 1: Set Up Default Discount Rates for Customers

If your business frequently gives certain customers a fixed discount, you can assign a default discount rate to their profile. This will ensure the discount automatically applies every time you invoice them.

How to Do It:

1. Open Sage 50 and go to the Customers & Sales navigation panel.
2. Click on Maintain Customers/Prospects.
3. Choose an existing customer or click to add a new one.
4. Navigate to the Payment & Credit tab.
5. Locate the field labeled Discount Percent or similar.
6. Enter the discount percentage you want to offer this customer (e.g., 5 for a 5% discount).
7. Save your changes.

From now on, when you generate a sales invoice for this customer, the system will automatically calculate the discount based on the rate you defined.  This method saves time and ensures consistency, especially when dealing with high-volume or repeat customers.

Step 2: Customize Discounts for Inventory Items

Sometimes, you might want to apply discounts based on the type of product rather than the customer. Sage 50 allows you to set different price levels for inventory items, which can act as a form of pre-configured discounting.

While Sage 50 does not have a dedicated “discount” field per item, you can simulate discounting by:

• Creating different price levels for your inventory items.
• Assigning specific customers to specific pricing levels.
• Adjusting the base price or selling price accordingly.

This method works well for businesses with tiered pricing structures, such as wholesale and retail pricing.

Step 3: Apply Line-Item Discounts on Sales Transactions

If you need to give a discount on specific products in an invoice, Sage 50 provides a way to enter discounts per line item in a sales transaction.

Here’s How to Apply It:

1. Open the Sales/Invoicing window.
2. Select your customer and fill out the basic invoice details.
3. In the item entry grid, choose the product or service you’re selling.
4. Locate the Discount column next to the Amount or Unit Price field.
5. Enter a discount percentage (e.g., 10 for a 10% discount on that item).

The software will automatically calculate the discounted amount and adjust the line total accordingly.  This feature is perfect for one-time discounts, promotional offers, or when you’re offering different discount rates on different products within the same transaction.

Step 4: Apply an Overall Invoice Discount

Sometimes, you may want to apply a single discount to the entire invoice, rather than adjusting each line item individually.

This option is often used for:

• Special promotions (e.g., 15% off the total)
• Manual negotiations or price adjustments
• Rewarding customer loyalty

To apply an invoice-wide discount:

1. In the Sales/Invoicing window, after adding all line items, look near the bottom of the form.
2. You will find a field labeled Invoice Discount, Customer Discount, or similar.
3. Enter the total discount percentage.
4. Sage 50 will apply the discount to the subtotal and recalculate the final invoice total.

Note that this discount is typically in percentage form, not a flat dollar value.

Step 5: Customize Invoice Layouts to Show Discounts

If you’re applying discounts, it’s important that your customers can see them on the invoice.

To make sure discounts are displayed:

1. Go to Reports & Forms in the left-hand panel.
2. Click Forms and select Invoices.
3. Choose the invoice template you use and click Customize.
4. In the Layout Designer, look for:
   • Line item discount fields
   • Invoice-level discount fields
5. Add or move these fields to visible areas of the invoice—ideally near the unit price or total fields.
6. Preview the layout to ensure clarity and alignment.
7. Save the customized template and set it as default.

Customers appreciate transparency in billing, and clear discount presentation helps avoid payment disputes.

Step 6: Apply Early Payment Discounts (Terms-Based)

In Sage 50, you can also offer early payment discounts—for example, giving a 2% discount if the customer pays within 10 days.

This is set up via payment terms, not in the standard discount field.

To configure this:

1. Go to Maintain and choose Terms.
2. Create or edit a term (e.g., “2/10, Net 30”).
3. Set:
   • Discount Percentage: 2%
   • Discount Days: 10
   • Net Due Days: 30
4. Assign this term to the relevant customer or invoice.

When payment is made within the discount window, Sage 50 will recognize the eligible discount automatically in cash receipts or payment entry.

Step 7: Track and Report on Discounts

Discounts affect your financial reporting, so it’s important to track them accurately. Sage 50 records discounts as part of your sales journal and general ledger entries.

You can also generate reports to review:

• Total discounts given during a specific period
• Which customers received discounts
• Which products were most discounted
• Impact of discounts on profit margins

Access this through your Reports & Forms section, under Sales Reports or Customer Reports.  Keeping an eye on these numbers will help you evaluate the effectiveness of your discount strategy.

Best Practices for Managing Discounts in Sage 50

Now that you know how to apply and display discounts, here are a few tips to manage them effectively:

Be Consistent

If you’re offering long-term discounts, use customer-level settings to avoid mistakes.

Use Discounts Strategically

Don’t apply discounts randomly. Use them to reward loyalty, clear inventory, or stimulate slow-moving product lines.

Audit Your Discounts

Regularly review your discount reports to identify abuse, overuse, or loss of profit.

Combine with Promotions

Coordinate system discounts with your marketing campaigns for seamless customer experiences.

Document Policies

Make sure your team understands when and how discounts should be applied. Document discount rules clearly in your internal procedures.

Common Mistakes

While Sage 50 gives you flexible discount options, there are a few common pitfalls to watch out for:

• Forgetting to show discounts on invoices: Customers might be confused if they don’t see the promised discount.
• Entering discount percentages incorrectly: A small error in a discount field can cost you big.
• Overriding customer default discounts without approval: This could lead to internal policy violations or lost revenue.
• Not saving custom templates: If your invoice layout doesn’t show the discount, all your work setting it up goes unnoticed.
• Mixing discount types: Avoid applying both line-item and overall discounts on the same invoice unless intentional, as it can lead to compounding errors.

Discounts can be a powerful tool for increasing sales, retaining customers, and driving short-term cash flow. When used properly, they add tremendous value to your business and improve customer relationships.  With Sage 50 Accounting, customizing discount rates is easy and versatile. Whether you’re setting up predefined discounts for loyal customers, applying promotional reductions during a sale, or using early payment incentives, Sage 50 gives you full control over how, when, and where discounts are applied.

By following the steps outlined in this guide, you can:

• Create standardized discount rules
• Customize invoice layouts to reflect discounts
• Apply flexible discounts per customer or product
• Track discount performance across your business

Managing discounts strategically through Sage 50 ensures accuracy in billing, transparency with clients, and improved profitability for your company.  If you haven’t optimized your discount settings yet, now is the time to explore the full capabilities of Sage 50,  and make every sale count.