Few people would buy a house or a car without comparing prices. But when it comes to groceries and other household items, many of us just go to the grocery store and buy what we need. We don’t put much effort into educating ourselves about prices on the items we purchase. By doing so, and implementing this knowledge to make purchases when prices are at their lowest, drastic savings can be accomplished. It takes a little time and a little organization, but the results are well worth it!
Note: Since not all shoppers have access to a variety of shopping opportunities, this article is going to be written based on a single store. This process can be expanded out by comparing prices at regularly visited stores and choosing among them to maximize the savings
Surprisingly, this process doesn’t start in the store. Start in your own kitchen or pantry, and look at what food and paper products you use all the time. The sheer number of items that the average family uses regularly can be daunting, and huge tasks can lead to no follow-through when it comes to new projects, so pick a small number of non-perishable staples that you use on a regular basis.
Create an entry for each of these items. If you’re using a notebook, give each item its own page. PDAs or other electronic formats can be customized to suit the program used, but the idea is to be able to track the regular price of each of these items over the course of weeks, months and years. For each item, you’re going to be tracking brand, type, size, price and unit price*, along with the date you recorded the price and whether there were other requirements (coupons, limits, other purchases necessary, etc.)
Set up columns for each of these pieces of data, grab a calculator for computing unit prices and we’re ready to head to the store!
Once at the store, start with the first item on the list. Our family uses a lot of peanut butter, so we’ll use that as an example, but other items are tracked similarly. I always calculate and track prices for the least expensive product of the kind I want that my family will use. This is an important thing to keep in mind. If your family won’t eat generic cereal, don’t buy it. Wasted food is a 100% waste of money.
Going to the peanut butter area, you will notice a lot of different brands. If your family will only eat one kind, check the unit prices on different sizes of that one brand. If not, check for the unit price of each brand available in each size offered.
When you’ve found the lowest unit price, make a note of it in the notebook, along with the brand, type, size of jar, price per jar, price per ounce and the date. As well, if this lowest price is because of a sale, you may want to make a little note of that, so you don’t beat yourself up if you can’t find it at that price next time you come to the store.
Continue this process with the ten items you’ve decided to start tracking.
Now, each time you come to the store, repeat the process. After a few visits, you’ll have a good baseline idea of what the usual cost for those items is. And, by knowing what the normal price is, you will know when to stock up!
The secret to saving money using Snowball Shopping is knowing /when/ to stock up. Our magic number is 30% – around 1/3 off the regular price. (Within reason, of course, if you find something at 28% off and your records show that that’s the lowest it’s been in months, don’t pass up your chance because it’s not /quite/ 30%!)
Let’s go back to our peanut butter example. You’ve determined, over the last month, that the normal price for peanut butter is somewhere around 19 cents an ounce ($6.00 for the 2 pound jar). But this week you go in and the sale price is just $3 a jar, just over 9 cents an ounce! That’s about 1/2 of the normal price, or more than a 50% savings! Time to stock up!
Now, you could just buy your one weekly jar and have saved yourself $3 – that’s a pretty sweet deal! But because you have been tracking it, you know this is a really good bargain and it’s time to start Snowball Shopping.
The strategy behind Snowball Shopping is to start small and roll your savings into bigger and bigger opportunities to save. If you’re anything like me, you don’t have a lot of wiggle room in your monthly grocery budget – that’s one of the reasons why you’re reading this article! But by figuring out what you’d normally spend on an item over the course of a month and then spending that allotted amount to stock up on more than a one month supply while the item is on sale very cheap, you will free up money out of the next month’s budget. Those savings can then be used to add to the allotted monthly expenditure for another item the next month, using the same technique. Eventually, you’ll have built up quite a bit of flexibility and will be able to take advantage of more and more opportunities to save.
Let’s take a look at how it works.
If you normally buy a jar of peanut butter per week, and they cost $6 per jar, you’re spending $24 to get your month’s supply. Say the store is running a special one week, offering it for $3 a jar. If you buy your one week supply, you’ve saved $3 over the course of the month, because next week the price will more than likely have gone back up. But if you spend your full $24 monthly allotment for peanut butter to purchase 8 jars, you now have a 2 month supply for the price of one month!
Next month, you don’t have to buy peanut butter! And, you now have that $24 that you’d have spent on peanut butter to use on something else.
This month, when you go shopping you notice that frozen orange juice concentrate, normally $2.50 for a 12 ounce can (or a unit price of just under 21 cents an ounce) is on sale for 99 cents per can! That’s just over 8 cents an ounce, or almost 60% off! Definitely time to Snowball Shop!
Normally you buy 4 cans of juice concentrate a month, so you’ve got $10 budgeted for your one month supply. This would let you purchase ten cans, or a 2 and a half month supply.
But you’ve also got the $24 you didn’t have to spend on peanut butter this month, so you’ve actually got $34 budget for juice. That will allow you to buy 34 cans, or more than an 8 month supply! You know you’ve got room in the freezer to store it, and (checking the expiration date on the juice) you know it won’t go bad before you can use it up, so you decide to go ahead and buy all 34 cans. You’ve just bought yourself an extra $10 to use in your Snowball Shopping for the next 8 months – more than an $80 savings, and you haven’t spent a penny more than you’d normally had budgeted for groceries.
Each month, continue to check the original ten items you started comparison shopping with, and as you get time and inclination, add more. Your ultimate goal is to have a baseline price for all the regularly purchased items in your household, and to be able to make informed decisions about when and where to stock up to save. Each month, reinvest your snowballed savings into whatever products give you the best return, until you’ve snowballed your available budget up into a good part of your overall budget, and you have built a reasonable supply (6-8 months for non-perishables) of the items you use on a regular basis. At that point, you may find that you can actually reduce your consumable budget, setting aside a portion of it towards savings or other investments (like a deep freezer which will allow an even broader scope of Snowball Shopping!)
© Jess Hartley – http://www.jesshartley.com
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