Tag: groceries

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Early Lessons, Part 5: Use Coupons? Not Anymore

For the previous posts in this series click Part 1, Part 2,  Part 3, and Part 4.  This post contains affiliate links.  If you make a qualifying purchase after clicking a link, we may receive a percentage of the purchase price.

When I was growing up, we had a newspaper delivered to our home on Sundays.  I remember the flyers full of coupons.  I would look through the flyers searching for products we use and, when I found one, handing the sheet to my mom so she could cut out the coupon.  She kept the cut coupons in alphabetical order in a recipe box with dividers for each letter of the alphabet.  When we were grocery shopping, it was almost like a game to figure out which item was a better buy based on combining coupons with items that were already on sale.

My other frugal shopping mentor — The Tightwad Gazette by Amy Dacyczyn (Amazon affiliate link)– also advocated the use of coupons.  Despite these stellar early examples, this strategy is one I’ve abandoned at this point in my life and I thought it was worth talking a little bit about why that is.

As always, there’s more than one way to analyze the variables.  I have a friend who makes excellent use of coupons and routinely posts on Facebook pictures of her receipts, showing how much she’s saved and spent, along with pictures of the items she bought.  I’ve asked her to write a guest post explaining her system.  That post will not be ready in time to be part of this series (I only asked her yesterday!), but I will link it here when we publish it.  I’m interested to hear what she has to say and find out if there are faults in the analysis I’ve made on this issue!

The World Has Changed

I’m 40-something years old.  When I was a child, there were no computers or internet.  We got our first home computer when I was in high school and I did not have an e-mail address until my freshman year of college.  The only way to get coupons was from flyers in the newspaper, the store sale catalog, or by mailing a letter to companies asking for them.

The Tightwad Gazette (Amazon affiliate link) was mostly written in the pre-and early-Internet era.  The book collates newsletters published (and snail mailed to subscribers) from May 1990 to December 1996.

As the world has changed, so have many of the systems and assumptions behind the use of coupons.

No store local to me doubles coupons

When I was a kid, our local supermarket doubled coupons.  If the face value was $0.10, you actually got $0.20 off the purchase price.  I am not aware of any stores local to me that double coupons.  If I’m wrong about that, I’d like to hear differently!

Paper? Hahahahahaha!

I haven’t had a newspaper delivered in years.  The last time I checked, which has been many years, the price of a Sunday paper was high enough that the coupons I could get were not enough to cover the cost of purchasing a newspaper.  I do not know anyone who has a local paper delivered, so it’s not like I could ask others for the coupons from their Sunday paper.

Privacy

Many people do use coupons and they have to be getting them somewhere.  While it’s true that paper isn’t really a thing, the internet is very much a thing and all the resources of the world — including coupons — are available on it.

However, every resource I’ve looked at for coupons requires you to create an account.  This includes going directly to the food companies as well as sites that serve as a hub, listing various sales and coupons available on the web.

I am decidedly uncomfortable with the number of accounts I already have on various websites.  I recently had a scare where an old account of mine had been hacked.  I spent several hours changing passwords on accounts — more than 40 of them.  I have never kept a complete list of all the accounts I’ve opened over the years and I’m sure I did not remember all of them.  I have no desire to add more accounts, which often means giving the companies permission to contact me (lots of junk mail) and / or sell my data (to whom?), just so I can save a couple bucks on groceries.

Some Things Never Change

Coupons come in two varieties — store coupons and manufacturers’ coupons. No matter who is issuing the coupon, they are doing so for one primary reason: to get money from you.

In the Big Picture, the House Always Wins

Sure, the coupon might save you $0.50 cents on that item, but what about the next time.  The manufacturer is betting that you will like their product and will buy it at full price.  When a store issues a coupon, they are betting either that you will buy other products too, making up for the $0.50 cents they give you on that one item, or they are betting that in order to get the $10 off your order of $50 or more, you’ll spend $65 when you otherwise would have spent $45.  Who hasn’t added a $15 item to their online shopping cart when they only need $5 more to get the free shipping — and the shipping would have been only $5?

The bottom line is that retailers and manufacturers use sophisticated research to manipulate you into parting with your money.  If coupons did not benefit them in the long run, coupons would no longer be a thing.  Failing to recognize this fundamental truth is like going to Vegas and thinking that the odds are in your favor, not the house’s.

Unlike Vegas, it is possible to beat the odds on a long term basis by failing to fall into some obvious traps when shopping.  You don’t have to spend more just because you’ll ‘save’ more off your order.  You can choose to purchase a different brand, based on your cold hard data, obtained through unit pricing, your price book, and the other tools which are forthcoming in this series.

Store Brand Products = Name Brand Products?

In general, retailers are not manufacturing the products branded under their name.  The products are manufactured by another company and privately labeled for the store.  But who is manufacturing the products?  Often, it is the name brand company.

For example, in this 2016 interview, Costco CEO Craig Jelinek mentioned that Duracell makes the batteries Costco sells under its Kirkland Signature Brand.  If the same company is manufacturing the product, why do Duracell batteries cost so much more than Kirkland Signature batteries? “[Jelinek] explained, ‘Now, this brand here is no advertising, there’s no overhead, there’s just packaging. We don’t advertise it. It’s just a brand.'”  The strong implication here is that you are paying Duracell extra money just so they can market their product to you and try to convince you that they are better than all the other battery brands in existence.

Just because the name brand company manufactures the store brand product does not always mean that the contents of the package are identical.  Sometimes retailers and manufacturers work out a product formula or parameters and the manufacturer produces to those specifications.  In that case, the retailer may have a product that is similar, but not identical, to the brand name products.  And sometimes, they only stop the production line long enough to change the packaging.  If that’s what they are doing, the store brand and name brand are 100% identical products.

The agreements between retailers and manufacturers are business contracts that you and I aren’t going to get to read.  Store brands aren’t labeled with the manufacturer names.  As a result, there’s no way for us to know which of the two manufacturing scenarios are true for a particular product.

Fun Detour/

What is important for our analysis here is that it is worth trying out the name brand product.  Have some fun and set up a blind taste test for friends and family.  I did this recently with butter and we had a lot of fun! Chris, my parents, and I tasted 17 different brands.  I was the only one who knew what all of the samples were.

If you want to set up a taste test, buy a variety of brands of the same product, purchasing the smallest quantity you can in order to provide a taste to all the people participating in your taste test.  Prepare a plate for each person, with small portions of each brand on the same plate.  Label each sample with a number or letter.  Write a list for yourself, not to be shared until the end of the event, correlating the anonymous label with the brand.

The food should be eaten in the same manner as you would normally eat it.  For example, when we did the butter taste test, I put little pats of butter on the plate.  I had bread on the side.  We each tasted the butter straight, then spread a little bit on the bread and ate it that way.

Give each person a sheet of paper and a writing utensil so they can make notes as they try each sample.  Tell everybody to keep their opinions to themselves until the end, so no one is influencing anyone else as you go.  Compare thoughts after everyone has finished trying all the samples.

When we did the butter taste test, I did not do a more involved test, like baking batches of cookies with all the different varieties of butter and taste testing the cookies.  This is an avenue you can explore also  — how does each brand perform under usual cooking conditions?

When you buy each brand, calculate the unit pricing of the brand.  After the taste test, match up the unit pricing with the results from your taste test.  How do they compare? /fun detour

Coupons = Brand Names

Coupons are a marketing tool.  Store brands have no marketing budget.  It is the manufacturers who offer coupons for their brand name products.    You’re paying more more for brand names in order to cover marketing costs and they give you back a small portion of that premium price in a coupon.

Coupons = Processed Food

When’s the last time you saw a coupon for carrots?  I’ve never seen one.  Manufacturers take raw ingredients and turn it into something else, then put a label on it.  Consumers don’t know exactly what they did in the process of turning the raw ingredients into something else because that information is usually protected as trade secret.  Maybe consumers will like the final product and maybe they won’t.

Manufacturers need us to try the product and like it in order to make money, and therefore they spend money on marketing.  Marketing tells us, subtly or not, what we should want and what is best for us, rather than providing us with information so we can make our own value judgments.  It is about influencing decisions, by manipulating emotions and beliefs.  Marketing is not about providing data.  Coupons are one facet of that marketing, designed to make us feel like we are getting a good, whether or not that is empirically true.

It’s true that some produce has brand names on it, but a head of romaine lettuce is pretty much a head of romaine lettuce.  You might want to know where the product was grown, if it was grown conventionally versus organically, and whether it is genetically modified.  Produce in the United States is already labeled with the first two pieces of data.  You have most of the information you need to make a decision, based on your values and dietary requirements.   What else could a company try to tell you about their product in order for you to only buy their lettuce, rather than the competing brand’s lettuce?

It is true that there are marketing campaigns for some ingredients.  For example, I remember ads for milk or almonds or California raisins.  But these campaigns are run by interest groups and are not connected to any specific brand.  I don’t recall ever seeing an interest group run a coupon valid for ‘almonds,’ with no brand listed.  Again, it is companies who ultimately offer coupons for their specific, brand name products.

My Personal Conclusions

When I weigh the above factors, I have a hard time believing that coupons are going to save our household money in the long run.  Buying raw ingredients and making my own foods rather than buying processed foods; purchasing store brands rather than brand names; and purchasing from warehouse stores, online retailers, liquidators, and other alternative sources usually save me more money than coupons can.  None of these strategies can be combined with coupons.  Coupons are not available for the first two strategies and alternative stores such as those listed in the third strategy usually do not accept manufacturers’ coupons.

There’s only one place where coupons might save me money — combining coupons with sales to stock up on nonperishable household and personal care items like toilet paper and deodorant.  We purchase a surprisingly limited number of items in these categories, so I have not taken the time to figure out a good process for handling coupons for them.  Instead, I purchase these items in bulk at Costco or on Amazon.

I am looking forward to reading my friend’s forthcoming post on using coupons and will re-evaluate my own choices based on her experiences and process.  It’s been a while since I’ve made an evaluation of best practice re: coupons and it may be that my analysis is based on outdated data and beliefs.

Click here for Part 6a: Calculating the Cost of Homemade: Ingredient Costs

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Early Lessons, Part 4: Shop at Multiple Stores

For the previous posts in this series click Part 1, Part 2, and Part 3.  This post contains affiliate links.  If you make a qualifying purchase after clicking a link, we may receive a percentage of the purchase price.

When I was a child, my mother went grocery shopping every week or every two weeks.  We went to the same store every time.  Once in a while, we might go to an outlet store for bread.  The Tightwad Gazette by Amy Dacyczyn (Amazon affiliate link) introduced me to the idea that if your goal is the lowest possible price, you must shop at multiple stores.

Why shop at multiple stores?

No store has the lowest price on every single product in the store.  The regular price of items will vary depending on arrangements with the product manufacturer or supplier, how quickly products turn over in that location, and many other factors.

Different stores have different items on sale every week.  Even if the regular price at Store A is the lowest usual price, the sale price at Store B may be the lowest ever price.

Sale items are often ‘loss leaders’ for the store.  A loss leader is an item that is sold below the price the store pays to buy that item in order to stock it in the store.  Every time the store sells that item, they lose money on it.

Stores use loss leaders as a way to get you into the store, believing that once you are there, you will buy enough other items that they will still make a profit on your overall purchases.  When an item is a loss leader, that sale price may be the lowest you will ever see for that particular item.

Finally, your local chain grocery store is not your only option.  If you take a broader look at the stores available to you, you have a better opportunity to find lower prices on the items you purchase.

Consider your shopping options

If you have always shopped at one grocery store, perhaps you have never looked further than whatever store is closest to your house.  Here’s some store categories to investigate when looking for your least expensive food options.

Grocery Chains

This category includes everything from discount grocery stores (e.g. Aldi) to whatever your usual mid-level chains might be to high-end chains like Whole Foods.

I go to Publix, a Florida-based grocery chain, at least once a week.  No matter which route you take out of our neighborhood, you will pass a Publix.  We have 4 stores within 4 miles of our house, one of which is a mile away and another of which is two miles away from our house.  These two locations are on opposite ends of the road that bisects our subdivision.  We go to Publix for those items we can only get in a grocery store, to pick up items we ran out of and need now, to get prescriptions filled, etc.  They have weekly BOGO (Buy One Get One) free sales, so I may go there to stock up if something we use is on BOGO.  Unless I’m getting BOGO deals, we shop with a handheld basket, not a cart, and we are checking out in the 10 items or less line.

I go to Whole Foods every few weeks or so.  Whole Foods is about 6 miles from our house, but in a direction we rarely go.  This location only opened a year or two ago; before that, the nearest Whole Foods was 15 miles from our house and we never went there.  Now we go mostly for specific dietary supplements and gluten-free bread.  When we are there, we look to see what’s on sale because, as Amazon Prime members, we get an additional 10% off the sales price (Amazon affiliate link).

Superstores

These are stores like Target and Walmart that have a grocery section in addition to clothing, household items, electronics, and more.

Target and Walmart are both conveniently located for me, across the street (in different directions) from Costco.  However, I almost never go to these stores for any reason so have not been making the extra effort to look at their grocery sales.

The Walmart near Costco is a small store, with a limited grocery selection.  We do have two other Walmart options — a Neighborhood store, which is Walmart’s groceries-only chain, opened four months ago three miles from our house, and a true Superstore with a full grocery store located five miles from our house in the opposite direction from Costco.  The Neighborhood store is smaller than our Publix options, but does have good prices on some things we buy regularly and it is very close.  I will be making an effort to get there at least once a month.

Stores specializing in specific regional cuisines

Chris and I like many cuisines from around the world.  Large national chains tend to have a limited selection of ingredients from a limited range of brands for a limited range of world cuisines.  If you want a full range of ingredients, you are better off shopping at stores that specialize in whatever cuisine you want to make.

Since these stores specialize and primarily cater to people who are making the day-to-day food of their heritage, the turn over on products is better than in the national chains.  Not only will the range of ingredients be better, higher turn over means fresher products, and the prices are almost always better than what you find in the national chains.

I just recently started doing regular fruit and vegetable shopping at a local chain called Fancy Fruit and Produce.  I buy produce at Costco also, but only things that will last a while or which we use quickly.  Almost everything else, I get at Fancy Fruit and Produce.  As the name implies, they are a specialty shop for produce.  They are also a specialty shop for Latin ingredients and, to a lesser extent, for Asian ingredients.  This is reflected in the wide selection of produce — I have not been in any other shop, even the other Latin shops in my area, that sells nopales — but also in their dry goods, meat, refrigerated items, frozen section, and bakery.  Fancy Fruit in Produce is 3 miles from my house, on the way home from Costco, so it is an easy place to stop and I go there a couple times a month.

In addition to Fancy Fruit and Produce, I regularly visit specialty shops for Indian and Asian ingredients.  I used to visit a Middle Eastern shop also, but it went out of business and I have not yet found a replacement in my area.  The best Indian shop in the Orlando area is Patel Brothers, a chain with 52 stores in the eastern part of the United States.  Unfortunately, it’s a 45 – 60 minute drive from my house, so I do not go as often as I would like.

The Asian grocery stores are maybe 10 miles from my house and along my driving route to / from my monthly spinning group meeting.  Despite this I do not stop very often because I am able to get the majority of the ingredients I need at Publix, Costco, Fancy Fruit and Produce, or online.  As a result, I visit the Asian specialty stores once every six months or so.

Warehouse Stores

In the United States, the three largest warehouse chains are Costco, Sam’s Club, and BJ’s.  At these stores, you pay an annual membership fee for the privilege of shopping there.  Products are all sold in bulk, meaning you must buy a large quantity at a time.

I do the majority of our household shopping at Costco.  Yes, we are a two person household.  It’s still worth it.  I do a major shopping at Costco once every 4-6 weeks, with visits in between to get things we forgot or need to replenish.  Costco is only 4 miles from my house, so it is quite convenient to get there. We drive by it regularly on other trips, so can and do stop in for a single item if we need it.

Farmers’ Markets

If you are looking for fresh produce, locally raised eggs or meat, or locally processed foods like jams, your local farmers’ market is a great place to visit.  Often the produce was picked that morning or the day before.  You get to talk to the farmer.  The money you spend on food goes directly to the person who grows it, without middlemen.  The combination of price and quality can’t be beat!

In the past I’ve done a lot of shopping at Farmers’ Markets.  However, the options that are currently convenient to me are not robust.  The majority of the stalls are artisan foods, not people raising produce or animals.  As a result, I do not regularly shop at any farmers’ markets.

Online retailers

Many items can be purchased at good prices online, with free shipping if you meet minimum purchase requirements.  Several companies offer spices online (my favorite is The Spice House because they sell reasonable sizes for household use, offer free shipping with a minimum order, and have excellent quality products).  Walmart, Amazon.com, and Costco (as well as many other retailers) offer a wide variety of products with free delivery once you meet the minimum purchase price.

At Amazon.com, you get a discount off their regular price with “Subscribe and Save,”(Amazon affiliate link) a service that will ship products to you on whatever schedule you choose.  This is particularly useful for those products you know you will have to replenish regularly — toilet paper, diapers, cleaning supplies, etc.  You can pick a different quantity and schedule for each product.  This eliminates two of the common concerns people have with some of these shopping strategies — you do not have to spend time and gas driving to multiple stores and you don’t have to worry about storage space.  The concept here is something that many businesses have done for years — Just In Time ordering, to minimize inventory but still get the best possible price.

I currently Subscribe and Save to two items — toilet paper and cleaning solution for our tile cleaner.  I get about 15% off Amazon’s regular price on each of these items.  The regular price plus discount is less than the regular price at my local shops.  I used to Subscribe and Save to the powdered broth mix my mother-in-law used and I had that shipped directly to her.  When she passed away, I stopped that subscription.  I am currently evaluating Subscribe and Save items to see if it is a good option for any other products we purchase.

Manufacturing facilities

Many food manufacturing facilities have small shops open to the public where they sell products at prices far lower than you will find anywhere else.  For many years, the Merita Bread Company baked bread at a factory in Orlando.  I used to go there to buy bread for 1/2 the price that it sold for at Walmart, which had the lowest price of any local retailer.  Unfortunately, the local factory closed when Hostess bought Merita several years ago.  I still miss the smell of fresh-baked bread wafting over I-4 when driving by that factory!

Since Merita Bread Company closed, I am not aware of any other local food manufacturing facilities with shops open to the public.  If you’re an Orlando local and know of something, I’d love to hear about it!

Outlets and Liquidators

These stores sell products that may be past their sell by date or that are scratch and dent products.  The shopping experience and product quality varies dramatically, depending on the store.

Outlets usually specialize in a specific brand name.  The most common outlet stores seem to be those for breads and related baked goods.  The selection is usually stable and the physical condition of packaging and product is high.

A liquidator, on the other hand, will have a wider variety of products, but the specific selection will not be the same from one visit to the next.  The condition of packaging and product varies significantly from product to product, package to package, and visit to visit.

I used to shop regularly at Sacks, a local liquidator, because it was on my drive home from work.  That shop hasn’t been on my way home from work for more than 10 years now.  It is perhaps 8 miles from our house, but along a route we almost never take for any other reason.  Since it would now require a special trip, I haven’t gone in years.

Yesterday, I happened to be driving by the store, so I stopped to see what they had.  I remembered both why I used to shop there regularly and why I have not been making a special trip to go there.  Despite not visiting the shop for years, I only bought four items — 2 bottles of Brianna’s Blush Wine Vinaigrette and 2 packages of spiralized zucchini.  The salad dressing was $0.50 / bottle ($3.50 at Publix) and the zucchini was $1.00 for a 12 oz package ($6 / pound for a similar product at Publix).  Obviously, the prices can’t be beat and that’s why I used to shop there regularly.

On the left, the shelf at Publix, taken yesterday. On the right, the bottle I bought at Sacks, with price tag visible.

The reason I have not been making a special trip to go there is that there’s rarely enough quantity of things I buy to make a special trip worthwhile.   The nature of this company means that selection will vary — I may never see another bottle of Brianna’s Blush Wine Vinaigrette in their store.  Many of their products are ones I will not buy, not just because they are products we do not use, but also because of the condition of the packaging.  I have no problem buying the canned or bottled products there, but am wary of anything that comes in a box or bag.  I may buy items from the refrigerated section, but am suspicious of the freezer section.

After yesterday’s visit, I think the considerable savings will make shopping there worthwhile.  I am thinking that I may start going to Sacks once a month, on days I’m planning to do a larger shopping trip at Costco.  Sacks is only 3 miles from Costco so combining the two into one trip improves the time and gas efficiency.

Wholesalers and Distributors

This category refers to the middlemen in our food system.  They aren’t manufacturing or raising food.  They are acquiring food from growers or manufacturers, then selling to the food industry.

Many of these companies require their customers to have food-related businesses and associated licenses and therefore do not sell to the public.  However, some of them will sell to the public.  If there’s something you want to buy in large quantities, it is worth the effort to look up your local wholesalers and distributors and give them a call!

I like to can things.  I’ve canned applesauce, marinara sauce, jams, cranberry sauce, peaches, and more.  We do not have a garden and do not have easy access to growers for many products.  One solution for me is Todd’s Tomatoes, a local produce wholesaler.  I’ve purchased both tomatoes and apples from them to turn into sauce, and will be getting tomatoes from them later this year when it gets cool enough that I’m not going to melt when standing outside stirring the marinara.

Cases of apples, purchased at Todd’s Tomatoes, waiting to be turned into sauce.

Common Concerns with Shopping at Multiple Stores

The most common concerns people have with shopping at multiple stores is that it will take too much time to organize food shopping before you go and too much time to visit all these stores and it will cost so much in gas that it isn’t worth it to visit all these stores.

On Time

The penultimate post in this series is about time and calculating the value of the time you spend on all of these strategies, so I’m going to leave a detailed discussion until then.  For now, let me just say that, like all the strategies described so far, this one may take some time to set up, but can save time in the long run.

How many stores you visit and how often you visit them is up to you and adaptable to your circumstances.  You do not have to go to all of these stores every week or every two weeks or even every month.  You may not have all of the listed options available to you.

Regardless of whether these different stores are local to you or if you need to drive a long distance to get to one, you do not need to go out of your way to shop at different stores.  Start by researching what is along your usual driving routes to work or school or whatever.  Make the easiest changes first and build from there.

On Gas

You can determine how much money you will spend on gas to get to a store and figure out if the purchases you make there save enough money to at least cover your gas.  Price per gallon / miles per gallon = price per mile * number of round trip miles to get to the store = how much you’ll spend in gas.  Or you can look up the IRS standard mileage rate for business deductions, which is calculated to include the price of all operating costs, including gas, maintenance, and wear and tear.  For 2018, the IRS standard mileage rate is $0.545 / mile.

When calculating the vehicle cost of a shopping trip, be sure to only include the mileage specific to that trip.  If I combine a trip to Sacks with a trip to Costco, the mileage attributable to Sacks is only the distance between Sacks and Costco, not the distance between Sacks and my house.

Let’s look at the cost of a trip to Sacks, using both calculations.  $2.70 / gallon of gas / 25 mph = $0.108 / mile * 6 miles (round trip) = $0.65 (rounded to nearest penny).  Using the IRS rate, the marginal rate of adding Sacks to a Costco trip is 6 miles (round trip) * $0.545 =$3.27.

Apply Your Own Value Judgments

The amount saved on the salad dressing, a product I regularly purchase, was a total of $6.00.  The amount saved on the zucchini, a product I had not purchased before due to the high cost and which I am unlikely to purchase again in the future, is $10.35.  The total savings for the trip is $16.35.

Once you have the data, apply your own value judgments.  Which way of calculating the vehicle cost makes the most sense to you?  Do you consider the amount saved only on products that you regularly buy?  Or would you count the $2.00 spent on the zucchini as a negative because it is money I would not have spent otherwise?

Depending on how you make these value judgments, I saved somewhere between $0.73  ($6 saved on regular price of salad dressing – $3.27 operating cost of vehicle – $2 spent on product I shouldn’t have bought) and $15.70 ($16.35 total savings – $0.65 cost of gas) during my visit to Sacks.  Neither of these extremes, nor the intermediate options on the scale between them, are incorrect ways of weighing the data.

Remember our ultimate goal here is food that (1) tastes good and (2) promotes health (3) at the lowest possible cost, with an eye to the (4) time it takes to procure, prepare, and clean-up our food.  Each these four points involves value judgments and different people will weigh options differently.  What I am trying to do is provide some tools that help you to weigh all your options so you are meeting that goal in the best possible way for your family.

Click here for Part 5: Use Coupons? Not Anymore

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Early Lessons, Part 3: Keep a Price Book

If you’d like to start from the beginning, click here for Part 1 and here for Part 2 in the series.  This post contains affiliate links.  If you make a qualifying purchase after clicking a link, we may receive a percentage of the purchase price.

I first learned about price books from The Tightwad Gazette by Amy Dacycyzn (Amazon affiliate link).  Keeping a price book was a revelation to me and forever changed the way I shop for groceries.  Over the years, I have not always kept up my price book.  When I first moved to Florida in 2002, I diligently set up a new one to help me learn my new stores.  I used it for several years, but when my life got busier I did not maintain it.  I just recently started a new one.

What is a price book?

This is a notebook in which you keep track of the price you pay for various products.  The focus here is on groceries, but you can use a price book to track any products that you buy on a regular basis.

There are several apps to help you keep this information in your phone, and I wish I could recommend one of them.  When I was starting my new price book, I tried at least 1/2 dozen apps.  They were all too fiddly for me, took longer to set up than the equivalent paper book, and did not function in a meaningful way after the products were set up.  If you do find an app you like, I’d love to hear about it!

Why keep a price book?

When we calculated the unit pricing on items, we figured out the best available price in that store at that moment.  The price book helps us to know the best available price across time and space (I desperately want a TARDIS-like acronym or pun here, but I’m not coming up with anything I love.  Please share suggestions in the comments!)

The price book gives us a convenient way to figure out which stores have the best prices on an item.  It helps us recognize how often items go on sale so we can, to the extent our storage allows, purchase enough of an item to last to the next sale.  If we check our price book, we immediately know if an advertised sale is, in fact a good deal.

How do you set up a price book?

Pick a Notebook

A price book does not have to be fancy.  You do not need to buy something special.  It can be any notebook hanging around the house.  I do recommend that you use something that is convenient for you to bring with you when shopping, so choose a size that is easy to carry or that you can slip into your purse.

The price book I put together when I first moved to Florida was a 5x8x1 three-ring binder.  I dismantled that one long ago.  I think I gave away the binder some time ago and I did not have any small notebooks around the house. However,  I did have the pieces to make a small notebook, using Levenger’s Circa system.

I printed my own 5.5×8.5 lined paper.  Usually you can find templates for this on the internet, but I did not find one I liked, so I made my own in word processing software.  I made two columns on a standard 8.5 x 11, tabbed two pages worth of underlining, then printed double sided.  After printing, I cut the sheets in half with my scrapbooking paper cutter.  I punched the sheets with the Levenger Circa paper punch that I got free when someone was getting rid of it many years ago.  For the covers, I used card stock I had laying around the house and I laminated the card stock with my Amazon Basics Laminator (Amazon affiliate link), which I got during a Black Friday sale a couple years ago and absolutely love!

Note that both of the options I chose allow you to add and remove pages.  I like this feature in a price book because I like to keep products in alphabetical order.  If I start tracking a new item, I can easily add a page in the correct place, an option not available if you use a bound notebook.  I use one sheet per product that I am tracking, both because it’s easier to keep products in alphabetical order and because a single sheet will last for multiple years of price tracking.

Think About What Products to Track

You do not have to track every single product you buy.  The two primary factors are (1) the impact of product pricing on your personal bottom line, which includes how often the product goes on sale and how often you personally buy it; and (2) grouping products in order to make true comparisons.

Your Personal Bottom Line

One purpose of a price book is to learn how often and when products go on sale, so you can stock up on that item.  If you are going to stock up on an item, it needs to be something you use regularly enough that it won’t go bad in storage before you use all of it.  If you are just going to throw something away in a few weeks or months, you have not saved any money.  Items that you will buy in quantity should definitely be in the price book.

Items that you will never buy in quantity might not need to be in the price book.  You could just check the unit pricing each time you buy it.  You might also decide to include these items in the price book so that you can do an initial comparison of your various options and find the least expensive option.  You could then do spot check comparisons every so often to make sure the option you chose is still your least expensive option.

My personal rule of thumb is that the frequency of purchase needs to be at least every six months for inclusion in the price book to be worthwhile.  The longer the interval, the less likely it is that today’s pricing information will be relevant the next time you buy the item.  I can still comparison shop and look at the lowest unit prices available to me at the time of purchase, but I probably do not need to put infrequently purchased items in my price book.

Grouping Like Items for Tracking

When deciding which items to track, you may decide that it is best for you to group items together for tracking purposes.  You probably do not need a single sheet for a particular name brand of most products.  The goal here is comparison shopping, which includes across brands.  You’re most likely going to have a page labeled “Salsa,” not individual pages for “Pace Salsa,” “Tostitos Salsa,” etc.

But if you only ever buy one brand, size, and version, maybe you will put the brand name on the sheet. Customize your book to reflect your own needs!

Since I am a vegetarian, I eat a lot of beans with grains and vegetables.  Do I really need to track every single variety of bean (black beans, kidney beans, red lentils, brown lentils, chick peas, channa dal, navy beans, etc, etc) that I routinely stock in my pantry?  Do I need to track dried beans and canned beans separately?  Maybe, but probably not.  Think about how your family eats and group products that you use interchangeably, so you can make true comparisons.

Decide Which Data to Track

In my price book, each purchase of a product has one line, with the following information:

  1. Date purchased
  2. Store where purchase was made
  3. Brand name of product
  4. Units in product
  5. Total price paid
  6. Notes on pricing, like if it was a sale, what kind of sale, and if I used a coupon

In my view, these are the minimum pieces of data that you need to track.  You may also want to write down your unit pricing, in addition to or instead of the Units in Product and Total Price Paid.  Doing so means you will not have to calculate unit pricing at that price / units combination ever again!

If you find yourself abbreviating the store or brand names, you might want to make a note, either on a page at the front of your price book or on the particular product page, so you remember what the abbreviation means!

Collect Price Information

You have three main options for collecting your initial price information when you set up the price book: (1) Use recent grocery receipts; (2) Go to the store(s) you shop at, price book in hand, and walk the aisles making notes; (3) Build your price book organically over time, either by bringing your book to the store with you and making notes while you shop or by making notes in your book immediately after returning from your shopping trip.  The fastest way to build your price book is probably a combination of these three methods.

I am still working on collecting price information for my current price book.  When I made the book, I immediately used the first option and I have been using the second option to continue building the book.  The major disadvantage of option 1 is that grocery receipts do not include the units for the products you purchase.  If it’s been some time since your date of purchase, you may not remember the units and you may have used the product and thrown away its packaging.

When I set up my price book when I first moved to Florida, I used option 2.  The disadvantage of this option is that your behavior is not that of a normal shopper and you may get stopped by an employee.  I visited several stores and was only approached by one employee asking what I was doing.  When I explained, they seemed unconcerned, but I did stop and leave the store shortly thereafter.  YMMV.

Using your price book

Once your price book is set up, regularly record the prices of your purchases.  You can refer to the price book when meal planning or making a list before you go to the store.  When you are in the store, you can refer to the price book to see if the price on a product is really a good deal.

After a while, you will find that you have a good idea of the lowest price you are able to find for regularly-purchased products and how often they go on sale.  Once you get to that point, you may decide that you do not need to update every product every time you go shopping. You might narrow your regular tracking to your most recently used items and items that change price frequently.

You will find that some products that never go on sale — many staple items rarely do.  Once you know about what you usually pay for those items maybe you only check the prices on them every six months or once a year, to make sure you are still getting the best available price.

A price book is a tool to help you make smart decisions.  Putting these details on paper provides you with data that you can rely upon in the future and frees up your active memory and decision-making functions for higher level tasks.  Since it is your tool, you can adapt it in whatever way makes the most sense for your life and the types of food and shopping choices you need to make!

Click here for Part 4: Shop at Multiple Stores.

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Early Lessons, Part 2: Pay Attention to Unit Pricing

Click here for Part 1 in this series. This post contains affiliate links.  If you make a qualifying purchase after clicking a link, we may receive a percentage of the purchase price.

My mother always took us grocery shopping when we were small.  By the time I was 8, she would say she either needed to bring a calculator or me.  I would keep a running tally of everything in the basket in my head and I would calculate unit pricing, also in my head, whenever she needed, without losing track of the running tally.  I like math 🙂

An Overview of Unit Pricing

Unit pricing is the single most important piece of information you need in order to truly comparison shop.  Is the 40 oz jar of peanut butter a better deal than the 16 oz jar of peanut butter?  The only way to know is to know the unit pricing.

To find the unit pricing, you divide the price of the product by the number of units in the product in order to find the price of a single unit.  In the peanut butter example, let’s say the 40 oz jar of peanut butter is $7.50 and the 16 oz jar of peanut butter is $3.00.  Which one is a better deal?  $7.50 / 40 = $0.19 / oz.  $2.75 / 16 = $0.17 / oz.  The smaller jar of peanut butter is the better deal. (I made up prices; the real price on Amazon is much better than this, if you are an Amazon Prime member.  The ad below is an affiliate link.)

Two things make unit pricing easier today than it was when I was a child.  First, 18 states plus the US Virgin Islands, Puerto Rico, and the District of Columbia now have labeling laws that require the price posted on the shelf to include unit pricing.

Florida requires unit pricing on shelf tags. In this case, the price per ounce is in the orange box. The units appear below the price.

Major online realtors, including Walmart and Amazon, have unit pricing listed on the food items for sale on their site.  If you are lucky enough to live somewhere with unit pricing on the shelves, you don’t need to calculate it yourself.

Second, if you’re carrying around a smart phone, you have a calculator on you at all times.  There’s no need to remember a calculator or to do the math in your head.  You’ve got an app for that!

When do You Need to Calculate Unit Pricing?

If you live somewhere that does not include unit pricing on the shelf labels, you have no choice.  If you want to know the unit pricing, you must calculate it yourself.  Even if you live somewhere that has unit pricing on the shelves, there are times when you will need to calculate the unit pricing yourself.

What is a Unit?

In the peanut butter example, I used the number of ounces in the jars as the unit.  Weight and volume are the most logical units to use for many, but not all products.  Do I care how much my paper towels weigh?  Not at all.  How many sheets do they have?  Or how many square feet?  These units make more sense.

The unit price on the shelf may be calculated using a unit that does not make sense to you personally.  Maybe you want to buy a certain number of servings of fruit and you want to compare the price per serving of apples and grapes.  You would need to figure out how much a single serving costs in order to compare.  A serving of grapes might be 1 ounce, but you may count a whole apple as a serving regardless of its weight.  Or maybe the paper towels are labeled per square feet and that seems like nonsense to you because you’re going to take a sheet at a time, whether you are using a smaller select-a-size sheet or full size sheet.  If this is your situation, you will have to calculate the unit price yourself.

Similar products may be labeled in an inconsistent manner.  As in the photo below, tea might be labeled by the number of tea bags in the box (right) or the weight of the product (left).  In the photo, the price alone might make you think the loose tea is much more expensive.  However, if you convert the tea bags to a per ounce unit pricing, you see that the tea bags are the more expensive option ($3.48 / 3.3 ounces in the box = $1.05 / ounce).

In order to compare inconsistently labeled products, you will need to calculate unit pricing based on the same unit for all of your options.  Choose the unit that makes the most sense for how you use the product and do the math!

Sales and Coupons

Sales flyers never have unit pricing in them, so if you are looking at sales flyers before you go to the store, you may want to calculate unit pricing as part of your planning process.  Once in the store, the signs with sale prices do not always include unit pricing to reflect the sales price.  If you have a coupon, you will need to subtract the coupon from the advertised price before dividing: (Price – Coupon) / Units.

A Preview of Things to Come

The next four columns in this series will all relate to and rely upon the idea of  unit pricing.  The bottom line is you need to be able to make a true comparison of the cost of the products you buy and the best way to do that is the unit pricing.  Since you have a calculator in your pocket or purse, it isn’t hard to calculate unit pricing.  It may take a little time to calculate when you first start doing it, but some of the strategies coming up will reduce how often you need to make the calculation.  Stay tuned!

Click here for Part 3: Keep a Price Book.

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Early Lessons, Part I: The Why

This post contains affiliate links.  If you make a qualifying purchase after clicking a link, we may receive a percentage of the purchase price.

Over the years, I have waxed and waned in my practice of the various strategies I’ve learned regarding saving money on groceries.  When I have money, but not much time, I don’t maximize these strategies.  When I have both time and money, I don’t maximize these strategies.  When I have time, but not much money, I must maximize these strategies.  At the moment, I find myself in the latter category, and so I am reminding myself of the things I already knew.  I thought I would share these things with you, to adopt or not, if it works for you.

Why Focus on Food?

This poster is World War I-era propaganda, aimed at those who were at home, rather than in the battlefield.  Governments across the world encouraged their citizens to economize in many areas, as a way of supporting the war effort.

If you are looking to save money in your overall budget, victory starts in the kitchen.  Food is the third largest household expenditure in the United States.

Housing and Transportation costs may be reduced, but they tend to be sunk costs.  If you own a home, it will take time to sell and buy or rent a less expensive place.  If you rent, the penalties incurred in breaking a lease may be more than you would pay to stay through the end of the lease.  Reducing transportation costs might mean moving closer to work, buying a new vehicle, or figuring out ride sharing options.  Since Housing and Transportation are sunk costs, it may take weeks or months to work out lower-cost options.

In the chart above, the amount spent on food includes both dining out and food at home (groceries), which includes purchase of both raw ingredients and prepared foods.  This chart breaks the food budget down into the types of food purchased, based on the level of employment in a household.

Households where all adults were employed spent about half of their food budgets at restaurants, whereas households where a primary shopper was unemployed spend only 36 percent. Households where all adults were employed spent 10 percentage points less of their food budgets on non-ready-to-eat foods compared to households where a primary shopper was not employed. The statistics for this chart are from the ERS report Consumers Balance Time and Money in Purchasing Convenience Foods, released on June 27, 2018.

This chart demonstrates why it makes sense to start with food if you want to reduce your budget.  You have multiple options for food: eating out, purchasing prepared foods, or purchasing raw ingredients and preparing food yourself.  Since food is perishable, you make a daily decision on what to eat. Therefore, the financial impact of changing your food decisions can be seen in a matter of days.

What’s coming in this series

The strategies discussed focus on grocery shopping for raw ingredients.  This is almost always the least expensive way to eat.  However, the overall goal is food that (1) tastes good and (2) promotes health (3) at the lowest possible cost, with an eye to the (4) time it takes to prepare food and clean-up afterwards.  The least expensive option possible is not always going to meet the first two goals and is likely to increase the time spent on cooking and cleaning up.

Almost everything I know about saving money on groceries, I learned from either my mother or The Tightwad Gazette by Amy Dacyczyn (Amazon affiliate link).  When I was growing up, our family did not have much money.  My mother kept a strict grocery budget and usually took her children with her when she shopped.  We learned many shopping lessons by osmosis!

I lived with my parents until I married my first husband, six weeks shy of my twenty-second birthday.  We did not have much money either, so I was always looking for ways to save money.  It was at this time that I found The Tightwad Gazette, which taught me systemization in a way that my mother had not.

The strategies I learned from my mother and from The Tightwad Gazette will help you determine the lowest cost of any food items you wish to purchase.  It’s up to you to weigh the monetary costs against the taste, health, and time factors impacting your life.

Click here for Part 2: Pay Attention to Unit Pricing

Click here for Part 3: Keep a Price Book

Click here for Part 4: Shop at Multiple Stores

Click here for Part 5: Use Coupons? Not Anymore

Click here for Part 6a: Calculating the Cost of Homemade: Ingredient Costs

Click here for Part 6b: Calculating the Cost of Homemade: Recipe Costs

Click here for Part 6c: Calculating the Cost of Homemade: Where to Start with Cooking

Click here for Part 6d: Calculating the Cost of Homemade: Putting it All Together