My Wax Supplier Offers a Lower Price at 100 Kg but I Only Consume 25 Kg per Month — How Do I Calculate Whether the Discount Is Worth Tying Up Cash?

The discount is worth it only if it beats the cost of the cash it locks up

Your supplier is offering a lower price per kilo if you take 100 kg. You use 25 kg a month. Buying 100 kg means paying for four months of wax today and storing three of them. The discount is the return you earn on that early payment; the cost is the cash you could have used for something else, the space, and the risk that something goes wrong with the stock before you use it. The decision is a comparison of those two numbers — nothing more.

Your title gives no prices, so this page uses labelled example figures you replace: ₹480.00 a kilo for 25 kg orders and ₹450.00 a kilo at 100 kg — a ₹30.00 discount. Over four months, buying monthly costs ₹48,000.00; buying 100 kg once costs ₹45,000.00. The gross saving is ₹3,000.00. But the bulk plan keeps an average of 50 kg on the shelf instead of 12.5 kg, which is ₹16,500.00 of extra cash tied up on average. At an example cost of money of 18% a year (your loan rate, or what the cash would earn elsewhere), that costs ₹990.00 over the four months. Add an example 1% storage-risk allowance (₹450.00) and the net saving is ₹1,560.00.

So in this example the discount is worth taking — just. The break-even discount is about ₹15.00 a kilo with the risk allowance (₹10.49 without it). Anything less than that, and you are paying to store wax. Anything more, and the bulk buy earns its keep — provided you have the cash in month one, somewhere cool to keep 100 kg, and a wax you have already approved. The rest of this page makes each of those checks concrete, then re-runs the question with CSI's real listed packs, where the answer is different.

The cash-flow table, month by month

The average-stock method above is the textbook version. The month-by-month view is what your bank account sees. In month one the bulk plan takes ₹45,000.00 out at once, against ₹12,000.00 for the monthly plan. You are ₹33,000.00 further out of pocket. That gap closes each month you do not buy, and only in month four does the bulk plan come out ahead.

Read the last column as "how much extra cash the bulk buy has borrowed from the rest of the business". It is ₹33,000.00 after month one, ₹21,000.00 after month two and ₹9,000.00 after month three, and turns into a ₹3,000.00 saving only when the fourth month's order would have been placed. If a festive order, a jar shipment or a marketplace payout delay lands inside those first months, that borrowed cash is exactly what you will be short of. Cash preservation against lower unit cost covers the case where you could buy 25 kg today or 100 kg at a discount and cash is tight.

Two patterns stand out. First, a small discount — ₹10.00 a kilo on a ₹480.00 wax — barely clears the carrying cost and can lose money if your cash is expensive. Second, the effect of the discount is far larger than the effect of the interest rate: going from ₹20.00 to ₹30.00 a kilo moves the result by about ₹1,000, while going from 12% to 24% moves it by about ₹600. So the first question to ask your supplier is the size of the discount; the second is whether you can spare the cash.

The same question with CSI's real listed packs

CSI does not list a 100 kg pack or a 25 kg carton, and publishes no volume discount; larger quantities are quoted on WhatsApp. So the reader's offer cannot be priced from our store. What can be priced is what 25 kg and 100 kg cost when assembled from the packs that are listed — and that shows where the bulk savings actually are on our catalogue.

Every row has the same price per kilo for 25 kg and 100 kg. On the listed catalogue, taking four months at once saves nothing on any CSI soy wax — so the carrying cost and the storage risk are pure loss. Chunks is the clearest case: the 10 kg bag is ₹599.90 a kilo, fractionally dearer than the 1 kg bag at ₹599.00, and 25 kg is cheapest as five 5 kg bags (₹14,975.00), not as two 10 kg bags plus a 5 kg. (Strictly, fifty 500 g bags would be ₹25.00 cheaper still at ₹598.00 a kilo — a quirk of the listing, not a reason to order fifty bags.) CSI 464 is ₹507.40 a kilo flat from 1 kg up. CSI 468 has a small 2.0% step at 5 kg (₹650.00 → ₹637.00 a kilo).

Natural Soy Pearl is the one real break, and it sits low: ₹450.00 for 1 kg, then ₹424.80 a kilo from 5 kg — a 5.6% step that a 25 kg month already captures. Buying 25 kg as 1 kg bags would cost ₹11,250.00; as 2 × 10 kg + 1 × 5 kg it is ₹10,620.00. The 50 kg bag is listed (in limited stock — confirm on WhatsApp before planning around it) at the same ₹424.80 a kilo. So if you want CSI's lowest rate on soy wax, you get it at 5 kg, not at 100 kg, and your cash stays free. If you need a quote for a larger quantity, ask on WhatsApp — no discount figure is published.

Before you hold four months of any wax: qualify it

Whichever supplier you buy from, 100 kg of a wax you have not approved is 100 kg of risk. If the real saving on CSI's catalogue comes from moving to Natural Soy Pearl (₹424.80 a kilo) from Chunks (₹599.00), that is a wax change, and it needs a side-by-side test against your current candle before you buy more than a bag. Pour 4 candles in your current wax (the control) and 4 in the candidate, with the same Fresh Strawberries Fragrance Oil at 8% (16 g oil + 184 g wax), the same Eco Thin C1 wick and the same White Matte jar. Natural Soy Pearl has no fragrance ceiling, melt point or pour temperature published, so 8% is a labelled test load — ask CSI on WhatsApp for the wax maker's stated maximum.

The priced test kit

If you hold your current wax already, remove its line and the kit is ₹1,807.00. Against a monthly saving of ₹4,355.00 on 25 kg if Soy Pearl passes (five 5 kg bags of Chunks at ₹14,975.00 against ₹10,620.00 of Soy Pearl), the kit pays for itself in the first month. That is a very different proposition from paying for 100 kg up front to chase a discount.

The decision rule

For the reader on this page — 25 kg a month — the concrete purchase from CSI is: keep buying one month at a time. If you stay on Chunks, that is five 5 kg bags (₹14,975.00). If the qualification test approves Natural Soy Pearl, it is two 10 kg bags and one 5 kg (₹10,620.00), which already carries the lowest rate CSI lists. Ask on WhatsApp for a quote above that; if one is offered, run it through the break-even above before you lock four months of cash into it. When a larger pack becomes worthwhile covers the same question as a monthly-volume threshold.

Related purchase-side costs

This page is about the cash cost of a bulk discount. The siblings handle the neighbouring questions: pack-size thresholds by monthly volume, landed cost per kilo after shipping, what ₹20, ₹50 or ₹100 a kilo does to COGS and cure time as working capital. The true commercial cost formula has a line for each. Outside the cluster, buying 25 kg at a time vs holding stock and storing 100 kg through an Indian summer go further into inventory and storage.

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