Am I Just Wrong?

I'm helping some people out with selling some products and they are trying to sell them to retail chains. It's a first attempt at that, prior to doing so they operated with just a web store. The head honcho is wanting to discount the CDs by 50% off retail price (giving the retailer a 100% markup margin) for them. I think he's an idiot. Instead we should be giving the retailer a 25-35% discount so they can then have a 50-60% markup margin in order to maintain pricing power. Who is right?