What is the difference between a sales discount and a purchase discount?

A sales discount is a reduction in the selling price offered by a seller to encourage customers to buy or to incentivize early payment. In contrast, a purchase discount is a reduction in the cost of goods that a buyer receives from a supplier, often for paying early or buying in bulk. Essentially, the sales discount benefits the buyer, while the purchase discount benefits the seller. Both discounts aim to facilitate transactions but from opposite perspectives in the sales process.