What is a price reduction?

A price reduction is a manual cut in the price of a product or service, typically given when the customer has experienced an error, poor quality or a delay – and the business wants to compensate. It differs from planned discounts and campaign offers in that a price reduction is only given in special cases, as a goodwill gesture.

A price reduction can be given as a fixed amount or a percentage, and it is recorded directly in the POS system together with the sale. This ensures that the till balances and that annual accounts and reporting take the reduced prices into account.

Example:

A guest at your café orders a latte, but it is forgotten during a busy period. The guest points it out, and you decide to take the full amount off as an apology. Instead of deleting the order line entirely or giving the item away free, you use the “price reduction” function in the till system, so it is still included in revenue – just at a reduced price. This ensures that both the till report and stock levels are correct, even though the item was given without payment.

Why is it important to understand price reductions?

When you run a restaurant or café, situations with dissatisfied guests or service mistakes will inevitably arise, and being able to handle compensation quickly and correctly is important. By using the price reduction function correctly, you ensure:

– Correct recording in the accounts

– An overview of how many price reductions are given

– No negative impact on stock levels (the item still counts as served)

– Full transparency for both bookkeeping and staff

By separating price reductions from general discounts, you get better documentation of when and why you choose to lower a price – for example because of poor service, errors or waiting time. This differs from planned discount schemes, which you can read more about in our entry on discounts

How price reductions are used in Flexybox

In the Flexybox till system, price reduction is a standard function that lets you lower prices directly on the receipt without changing the product price itself. The employee selects the item on the receipt and applies a reduction as either a fixed amount or a percentage. This function is especially useful when giving compensation without disrupting stock management.

The price reduction is clearly shown on the receipt and in the till report, so it is easy to keep track of all price reductions.

Read also: Terms of agreement – what do they mean for your business?

Frequently asked questions

No, a price reduction is given as compensation in specific cases, not as part of a planned offer or campaign. A discount, on the other hand, is often used in marketing and sales promotions.

Yes, in Flexybox you can use user permissions to decide who may give price reductions and whether manager approval is required.

The price reduction appears clearly under the product that has been reduced – either as a percentage or as an amount. The customer can therefore see the original price and how large a reduction was given.

No, as the item is still considered sold. This means it is deducted from stock just like a normal sale – ensuring correct consumption figures.