Smart Spending Cheaper by the Dozen(s) in Warehouse

What about shopping at warehouse clubs like Costco and Sam’s Club, where things, taken individually, are dirt cheap but you have to buy enough to fill a gymnasium? The bottom line: On the whole, you’re likely to do better at such places than you would buying comparable items elsewhere. The reason is two fold not only do such clubs buy in huge quantities, which allows them to sell many items for less, but the prices always remain the same. By contrast, supermarkets employ a “high-low” principle most of their everyday items are priced more expensively than similar items at Costco and other warehouse clubs, but occasionally they’ll put something on sale at a price lower than that charged at the warehouses. The idea is to rid their shelves of a particular item while getting you into the store to buy other, more expensive items that’s how supermarkets make their bucks. So you can occasionally get a better deal at supermarkets if you’re obsessive enough to keep an eye out for sales, but, day in and out, the prices are better at the warehouse clubs.

As for other items, warehouse clubs can be substantially less expensive than other retail outlets; computers, exercise equipment, electronics, and other household goods are consistently cheaper. (The one occasional exception is camera equipment that can often be bought less expensively via mail order.) However, for most items, particularly expensive ones, it’s easy to make back your annual membership fee (which usually runs about $20 to $30), occasionally with just a single purchase.

There are, however, some caveats to warehouse clubs:

- Keep an eye out for unusual brands. Shoppers often won’t find mainstream electronic products in warehouse clubs, such as products that are rated in publications like Consumer Reports. Instead, since they can buy in such bulk, clubs often have manufacturers produce items specifically for them (this avoids antagonizing conventional retailers). While that makes for cheap prices, it also makes genuine head-to-head shopping comparisons impossible.

-Don’t shop at a discount club as you would a grocery store. It simply doesn’t make sense to stop at Costco for one item. Rather, it seems better to augment your usual grocery shopping by stocking up on those items that are available at a warehouse club, particularly non perishables.

-If service is important, bypass the warehouse clubs. The clubs are not the place to shop if you need expert advice on choosing the item that’s right for you. Instead, do your research beforehand, choose the item that you want, then see if the warehouse club happens to stock it.

-Think about your storage capacity. While it isn’t as bad as it used to be, many items available at warehouse clubs still are sold in large, bulk quantities (the proverbial bale of toilet paper, for instance). Large families, groups, or shoppers with a good deal of storage space are best suited to these sorts of bulk purchases. If all you have is a small apartment with little in the way of storage, you might find yourself lining the walls with shrink-wrapped multi-packs of Kleenex and telephone-booth-size Cheerios boxes. One way around this is to split up warehouse orders with friends or relatives.

-As is the case with shopping anywhere, be particularly leery of impulse buying at warehouses. Since items are proportionately a good deal cheaper than you can find them elsewhere, it’s easy to talk yourself into buying something, not because you genuinely need it but because the price makes it irresistible. Well, do your best to resist, because the consequences can be nasty, since you’re convincing yourself to buy things that add up fast. For instance, an impulse decision to buy a bottle of spring water at the grocery store may cost you a dollar, but making the same choice with a case of water can cost you ten. A few like decisions, and it’s awfully easy to walk out of a warehouse having spent a hundred dollars, mostly on items that would be surprisingly unappealing elsewhere.

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