Sunday, June 22, 2008

Shopping Habits = Money Spent

I don't think that anyone will argue that we are in difficult economic times right now. A lot has been written about how to weather this bad period and still be able to provide what we need for ourselves and our families.

One such piece of advice said that people need to be making fewer shopping trips during the week: reduce shopping to once a week. An article I read said that for every shopping trip that we take we spend about 10% more then we were planning on or had budgeted for on items that we originally did not go to buy, what they call impulse buying. A different article said that only shopping once a week is not enough: you need to limit your your food/clothing shopping to one store. Otherwise, the article stated, you still have the affect of having shopped more than once, with the resultant overspending. Yet another article says that people fail to factor in all the costs for shopping and so overspend without realizing it. They do not count the cost of gas into their expenditures, nor the wear and tear on the car. They do not count their time either, time that might be better used producing an income or reducing reliance on having household help for things that you are not around to do, such as laundry, cleaning, babysitting etc. There are plenty of other "theories," all purporting to be "the" way to get by in the most economical way.

None of the theories is wrong, nor are they all correct either. Where they are all correct is where they tell people that there are going to have to be changes made in how and when money is spent. What they do not take into consideration are some of the following.

Supermarkets, drugstores and most retail businesses in a geographic area are all competing for the same customers. What is more, they are all selling more or less the same items. So why go to more than one? Special sales. Every supermarket advertises in circulars found in newspapers and in the stores. Each market has its special sale items. But here is where some of the stores get you if you are not careful. Just because the store prints "sale" next to an item doesn't mean that you are getting a bargain. What is the regular price of that item in that store? Do other stores sell that item at the same price or are their prices higher or lower? Then there are the "Wednesday only" (or pick your day) sales. An item, or a few items are going to be on sale but only one day during the week. Again, is the cost of that item worth going to the store on that day? And then you have to ask, aside from the sale items, are the other things you need to get while you are in the store going to cost you more then you would have paid elsewhere? If you save $2.00 on a container of milk are you going to give the store back that savings when you pay $2.00 more for the bread you also are buying then you would have in another store?

In our area you have to drive to get to shopping. At $4.25 to $4.50 a gallon of gas, how much is it going to cost me to take out the car once or to take out the car many times? That depends. If an item on sale at a market on a Wednesday is a savings of $3.00 over the regular price but it costs you $4.50 to go and buy it, you have saved nothing. Or have you? Keep in mind that if the item were not on sale and you needed it you would still be paying that $4.50 in gas. The stores in our area are all pretty much within shouting distance of each other. Were I to visit all the major markets, a drugstore or two, the butcher, the bakery, a hardware store, a 99 cent store and the cleaners all on one trip, I still would not have used one gallon of gas. But let's say that I did. On my shopping trip I would need to save at least $4.50 just to reach the break even point. Any savings after that I could first start to count as actual savings.

The way a shopping list is organized also needs to be changed. First, people need to have a list of the items that they buy, and any brands that they specifically buy of that item. Organizing that list by type of item is helpful, that is, paper goods, laundry products etc. Prices may be helpful next to those items if the cost of the item is generally the same everywhere, or when the cost is always less at a particular store. A copy of that list should be prominently displayed somewhere or be within easy reach. On that copy place the number of items that you presently have in the house. Each time you use one of that item change the number. In this way you will see what you actually have on hand and what you might need to buy.

Next, make a blank shopping list with the names of the stores you shop at regularly as the subject headings (leave some space in between).

Next, check your supplies, figure out what you need, and just jot those items down on a piece of paper. Now comes the harder part. Start checking the various store circulars. Is something that you need on sale at one store? Is the savings more than just a couple of pennies? Put that item down on the store list under the store name that has the item on sale. Put the price of the item next to it so you'll be reminded of what the sale price should be (Don't count on the computerized cash register to give you all the discounts you are entitled to--they are notorious for not doing so. You need to know what the discount should be and you need to check your register tape.) Now check and see if you have any coupons for the products you are buying. If so, mark that next to the product on the list to remind you to use the coupon.

Now look at your shopping list. Is there a store where you are only going to buy one or two items? Ask yourself how much you are really going to save by making the extra trip. Is the savings only going to be a few pennies? Then it's probably not worth it. Is this an item that you can stock up on and maximize your savings? When All detergent went on sale for $2.99 a bottle instead of the regular $5.69 to $6.79 found in all the other stores I stocked up. At a minimum I saved $27.00 on ten bottles, and their expiration date is years into the future. That's all I bought in that particular store but it was worth the trip for that item.

And now you come to the really really hard part. Take your list, go to the stores and buy only what is on your list. Absolutely the only exception to this rule is if there is an unadvertised special on something that you forgot to put on the list or that you don't usually buy because the price is normally way out of range for what you will pay. I don't usually buy ice cream because the price has gone sky high even though my family likes it as a treat occasionally. But an in-store special last week had ice cream selling at about 75% off the regular price. I bought 4 for the price of one--they last just as well in my freezer as they do in the store's freezer.

Last week I shopped three times because of when things were going to be on sale, where, and when I needed them in the house. The register tapes showed my savings for each shopping trip. Adding them all together I saved $147.69, after I deducted 1-1/2 gallons of gas used. For this week my estimated savings is about $31.00 dollars, but I won't be shopping as many times and I don't need as much.

Yup, work involved if you want to save money shopping for groceries. But the days when you could just scratch a shopping list on the back of an envelope and head for the store are no longer with us. Shopping requires a business-like attitude and business skills. Going to the market without a small hand-held calculator to figure the differences in package sizes/price ratios means you're going to get rooked. Doing the leg work at home can save you a bundle. If you think that it's too much work for what you are getting, ask yourself what you could have done with an extra $147.69 in your pocket, or even an extra $31.00. I'll bet that you could even find a good use for the money if you "only" saved $10.00 dollars a week.

I look at my saving money while grocery shopping as a "part-time" job, one that pays me about $30-50 per hour year round.


Anonymous said...

So you actually shop this way? It's not just something you are recommending that you don't do? Somehow having all those lists seems like it is making more work not less work. But I do like the savings you show. Was it all store sales or mostly coupons?

Orthonomics said...

If ProfK's method is intimidating, there are other methods. Once you figure out an effective method, the entire thing gets easier and easier.

One place I tend to find bargains is the shelf at the back or side of the store with dented items. If I'm really lucky, I have coupons in my coupon wallet on these items. I've bought little tomato sauce cans for $0.05. I've bought huge cans for $0.50 and less. I even picked up 4 free boxes of cereal last year because there was a coupon for $2.00 off (a dented box priced at $2.00) if you bought a certain brand of Orange Juice that happened to also be a doorbuster deal for the week.

Orthonomics said...

Oh, the way I handle our list is by having a list posted on the refrigerator at all times. Should we be running low on a staple or should someone want something, they have to add it to the list or ask me to add it. Occassionally, a pre-schooler writes a letter on the list and I have to ask for an interpretation.

I add Shabbat wish list items during the week as I plan my menu.

Anonymous said...

We don't shop that way at all. We have a few, very few, things (like meat and cheese) that we buy when we need them. Everything else we buy when it goes on sale. And when things aren't on sale, we do without for a period of time.

After some terrific sales, this method does lead to some interesting results, for example, 2 or 3 years of olive oil in the pantry, a year of diapers in the garage, a year of pancake batter mix in the pantry, three or four months of breakfast cereal in various places. And, of course, we never, ever, have purchased paper towels or toilet paper that wasn't on sale.

We also use coupons as often as possible, sometimes on a Sunday, we notice that our paper (delivered) has some really good coupons in it, so we go to the machine and buy another 3 or 4 papers in the evening.

It's relatively small amounts, but over the entire year, it might amount to $2,000+. After all, we are a family of 7 that eats a lot! Still nothing compared to the tuition, but it pays for almost half the property taxes.


Anonymous said...

I'm also a list person. I keep a list on the computer of every single thing that we might buy, the brand if that makes a difference to us and the size. I print out that list and just circle what I need to buy that trip. I also put down what the sale price is supposed to be. Not only does it work for me but if my husband has to go shopping for me there is no guessing about what to buy.

Scraps said...

I'm very similar in the way I shop. I'm not quite as organized, but that's a pretty good picture. However, I don't ever shop anywhere that requires me to travel by car, so I can take the charge for gas off my tally of costs. :) (Hooray for unlimited Metrocards!)

Anonymous said...

I sort of had nothing to do this afternoon and I was interested in that idea of making a list of absolutely everything that I buy for our house. I typed it up, printed it and then found out something that I really hadn't realized before. The section I wrote up for Snack Foods had more items in it then any other section. When I added in the items from some of the other categories that are also really snack items, like soda and ice cream, I couldn't believe how much we were spending on these items. We have 4 kids and no one is a teenager yet but not one of them likes the same snack as the others and they eat quite a few of those snacks when you count in what gets sent to school and then at home. I used to feel that I fed my kids pretty well and didn't overdo the snacks, but looking at a printed list really shocked me into seeing the real state of things. What's even worse I estimated how much those snack items were taking of our food budget and I couldn't believe the number. I haven't bought steak in forever because I always say we can't afford it. I could afford it once in a while if I would cut the snacks down. I think I may thank you when I get this all figured out, but not so sure my kids are going to be very thankful to you.

Anonymous said...

Keeping an inventory list is a great idea because you can't lose things in the back of the closet when your list says they are in there somewhere. A great idea for the freezer as well. Too many things that really were great bargains that end up being thrown out if you don't remember that you have them or don't use them by their expiration date.