The moment you name a number, you have set a floor. Not for this promotion. For every promotion, on every account, for as long as that account manager keeps their notes.
Here is the email that starts it. A brand manager at a large retailer writes with four friendly questions. What percentage funding do you offer on promotional activity. How often do you run it. How do you work with your other retailers. Do you have a promo calendar. It arrives looking like admin. It is a rate card, and you are being invited to write your own.
Search the question and the internet hands you groceries. Trade spend at 11 to 27 percent of revenue, vendor-funded markdown, a consultancy deck on deal management thick enough to prop a door. All of it built for a brand with a field sales team and a shelf in every supermarket. None of it built for the person who updates the offer file on a Tuesday morning between two other jobs.
Here is the part most sellers miss. You are already funding promotion in two entirely separate ways, and the retailer is asking about one while you are thinking about the other.
The first is placement. Sponsored products, retail media, real money leaving the account every week for visibility.
The second is price. You set a discount in your own offer file, you choose the window, you carry the whole margin hit, and nobody contributes a penny. On one account I looked at recently, 341 live offers were sitting on a discount funded entirely by the seller. Not one of them had a co-funding arrangement behind it.
So before you invent a percentage, go and measure the distance between your marketplace price and your own shelf price. On five lines I checked, the marketplace price ran between 1.2 and 2 times the site price. One was exactly double.
Sit with that. The discount they want you to fund may already be living inside your own pricing, quietly, rent-free.
Promotional funding is not a percentage you owe. It is the gap between two of your own price tags, and you either go and find it or you hand it over to someone who already has.
If this is the exact wall you are staring at, tell me what you are seeing: mail@sandeepkv.com, or message me on LinkedIn.