Sequential discounts

What do you think is your discount if someone sends you a proposal for 100 Euros but offers you a discount of 50 %? That´s easy, you say. It´s 50%.
Have you seen a discount of 25% + 25%? This is called a sequential discount and it IS NOT 50%! Let´s try calculating it:

• the base: 100$
• discount No.1: 25%
• price after discount: 75$
• discount No.2: 25%
• price after discount: 56,25$

What is your discount, then? 44.75%! And your supplier has saved 5.25% by using this trick. Quite amusing, isn´t it? My math teacher would kill me if she saw me writing 25+25 <> 50, but “such is business life”, I would have to say.

P.S.: Recently, I got an offer with a 15%+10%+5% discount. After I calculated it I realized my discount was actually 30%. My supplier has obviously seen this type of discount somewhere, but I don´t think he noticed how to calculate it.