What is tier pricing?

Tier pricing is a promotional tool that lets you price items differently for higher quantities.
This is an effective way to move more merchandise. For example: you sell office
supplies and you want to create a promotion where customers who buy three boxes of
printer paper save money compared to buying just one box. In the front-end this will display
like this:

Now when customers add 3 of the printer paper to their cart, they will see an item price
of $14.49 each, as opposed to $16.99 for just one.

How do I set up tier pricing?

Here’s how you do it:

In the Magento admin, navigate to “Catalog -> Manage Products”

Find and click the product that you want to add tier pricing to (or create a new product).

Locate the “Prices” tab on the left and click on it.

Click the button that says “Add Tier.”

Enter the qty you wish to start the tier pricing at.

Enter the new price per item that will take effect at the quantity specified.

Press “Save” to save the changes and have tiers start displaying in the front-end

The Price tab for the product displayed above:

Voila - you just added a pricing tier. To add more tiers, simply press the “Add Tier” button again.
If you don’t want one of the tiers, press “Delete Tier” next the tier you want to get rid of.