Discounts and allowances are reductions to a basic price of goods or services. They can occur anywhere
in the distribution channel, modifying either the manufacturer's list price (determined by the
manufacturer and often printed on the package), the retail price (set by the retailer and often
attached to the product with a sticker), or the list price (which is quoted to a potential buyer,
usually in written form). The market price (also called effective price) is the amount actually paid.
The purpose of discounts is to increase short-term sales, move out-of-date stock, reward valuable
customers, encourage distribution channel members to perform a function, or otherwise reward behaviors
that benefit the discount issuer.[1] Some discounts and allowances are forms of sales promotion.