Where the ceiling comes from
A rewards program is paid out of gross profit, not out of revenue. The same 5% is cheap for a coffee shop keeping 65 cents on the dollar and heavy for a grocer keeping 20.
The rule Rewa uses: the program should not eat more than 10% of your gross profit. At a 45% margin that is 4.5 cents of every dollar that customer spends. The green band in the calculator stops at 60% of the ceiling, which leaves you room to raise the reward later.
We picked that ceiling. Above 10% the program starts competing with rent and payroll, and the owner switches it off by month three.
How to read the extra visits
The second number is the one that decides. If the program costs you $12 a month per customer and each visit leaves $9 of gross profit, one and a half extra visits a month covers it.
Most loyalty pitches quote a sales lift from someone else's study. This goes the other way: the calculator tells you how many visits you need, and you decide whether that customer has them to give. A coffee shop whose regular comes twice a week has room for one more. A salon with a visit every five weeks does not.
When the extra-visit number looks impossible, the sizing is what to change: two more stamps usually fixes it.
Three sums that usually go wrong
The standing discount
Ten percent off every purchase costs you 10 cents on every dollar, every day, including from people who were buying anyway. A free coffee every tenth visit, on a coffee that costs you a quarter of what you charge, runs about 2.5%, four times cheaper, and the reward feels bigger.
The long card
Twenty stamps at a salon with a visit every five weeks is nearly two years. The card looks dirt cheap in the calculator because the reward never gets handed out, and the customer drops it by visit three. A target that works: the reward should land within four to eight weeks.
The uncapped reward
Twenty percent off looks the same every day until someone settles a long table. If you give a percentage, cap it per purchase: in Rewa the cap travels on the card and the counter shows it when the reward is handed over.
Three programs with the numbers run
All three come out of this calculator. Change the values above to see yours.
Coffee shop
- $6 ticket, 65% margin, 8 visits a month. Ten-stamp card, one per visit, free $6 drink.
- The drink costs you $2.10. The card fills in a month and a quarter, so $1.68 a month against $48 of spend: 3.5%.
- Green, with the ceiling at 6.5%. Half an extra visit a month pays for it.
Nail salon
- $45 ticket, 65% margin, 1 visit a month. Six-stamp card, one per visit, free service.
- The free service costs you $15.75 and lands every 6 months: $2.63 a month against $45. That is 5.8%.
- Amber: the green band ends at 3.9%. Ten stamps brings it to 3.5%, but that is a ten-month wait. Keeping six and using the reward to pull the visit forward is the better bet: one extra visit a year covers it.
Bakery
- $18 ticket, 45% margin, 6 visits a month. One point per dollar, 400-point reward on a $12 box.
- The box costs you $6.60 and the customer earns 108 points a month, so the reward lands every 3.7 months: $1.78 a month against $108. That is 1.6%.
- Green, with the ceiling at 4.5%. There is room to drop the reward to 300 points and make it feel closer.
Questions
What margin do I use if I don't know mine?
Think per item: out of every $100 you charge, how much is left after what you paid for the goods. Food service usually keeps 60 to 70, a grocery 20 to 30, a salon 60 to 80 because most of it is time. The exact figure matters less than you would think: the result barely moves between 45 and 50.
Why ask for the item's price instead of my cost?
Because you know the price and almost nobody has the cost handy. The calculator derives the cost from your margin: a $6 drink at a 65% margin costs you $2.10 to replace. If you know your real cost and it differs, enter the price that produces it.
Does this work the same for points and stamps?
The math is the same, the earning differs. Stamps arrive every so many visits, points every so much spend. For points, run the cheapest reward on your menu, because that is the one people redeem.
What about rewards along the way?
Treat them as a second program: run the final reward, then run the mid-card one at the stamp where you place it, and add the two percentages. A Rewa card takes up to three rewards along the way.
What does Rewa cost?
Basic is $39 a month for one location and Pro is $79 for up to three, with a 14-day trial. That is separate from the program cost on this page, which is what you give back to the customer.
Do you store what I type?
No. The math runs in your browser and nothing is sent anywhere. If you use the button at the end, the program values travel to signup so you don't type them twice.