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High street price trapsÂ*-Â*MSN Money Consumer Centre | Money saving tips | Consumer advice | Scams exposed
By Naomi Caine, writing for MSN Money
March 11 2009
If you go down to the supermarket today, you'd better watch out. Did you know that a team of retail managers, marketing experts and psychologists has already been hard at work to make sure the store squeezes every last penny out of every last customer? But with our handy guide to the tricks of the retail trade, we put you back in control of your trolley.
Smell the money
Supermarkets often waft delicious smells into their stores and even their car parks in order to make us feel hungry and pile more into our shopping trolleys. So, that lovely smell of freshly baked bread or seductive scent of vanilla is all about money.
The layout makes you pay out
Ever wondered why staple foods are always at the back of the store? The answer is simple but cunning. If you have to pass lots of other goodies on the way to pick up your bread and milk, maybe some will end up in your basket.
Cost a packet
You would expect packaged fruit and vegetables to be more expensive than the loose variety, wouldn't you? After all, someone has to cover the costs of the packaging materials and the labour. And you only have to look at broccoli in my local supermarket to prove the theory. The green stuff in a cellophane wrapper costs £2.93 a kilo, compared with £1.98 a kilo for the loose variety.
But you would be wrong to think that packaging always costs a packet. Carrots, another staple vegetable, cost 87p a kilo loose, but a cheaper 78p a kilo in a plastic bag.
You can even find more exotic vegetables that are cheaper in a packet. Take peppers. I could buy a bag of three mixed peppers for the equivalent of 46p each in Tesco last week. The same peppers loose cost 63p each.
So why do supermarkets sometimes price their packaged foods more keenly than their loose items? Well, you can actually end up spending more on the packaged food, even though it's cheaper.
Let's look at those peppers again. If you bought the pack of three peppers, you would spend £1.38. But do you really want three peppers? If you could manage with two peppers, you would spend just £1.26.
It's the same with the carrots. The bag is a kilo, so costs 78p. But you might want only 500g, so you could spend 43.5p on half the weight. Yes, you are paying more per pepper or per kilo, but your total food bill will be less.
The butcher, the baker....
Most supermarkets these days have a separate butcher, baker, even fishmonger. And most shoppers presume the produce at the specialist counter is more expensive than the mass produced stuff on the shelves.
But is it? Last week, I found an 800g granary loaf at £1.00 in the bakery, but £1.58 on the shelf. I could also have bought lamb chops for £12.98 a kilo at the butcher's counter, compared with £13.98 a kilo on the meat shelves.
How low can you go?
When you are browsing round a supermarket, where do you look? You might take each aisle in turn, but do you really scan every shelf? Few of us bother to look at the bottom shelves because it's awkward to stoop down - or embarrassing to grovel on the floor for your purchases.
So that's where the supermarkets stock the low-cost food - somewhere you rarely look.
The pasta aisle was a revelation in a nearby supermarket. At eye level you can choose from a wide range of pasta sauces including Loyd Grossman and Jamie Oliver. The pasta is also a recognisable brand.
But when I managed to lower myself to the bottom shelf, what did I find? There were packets of cheap own-brand pasta. Sauces were also inexpensive. I picked up a jar of simple pasta sauce for the equivalent of 17p per 100g; that's about half the price of a Dolmio sauce.
There's another way the supermarkets can make money out of their shelf stacking. "Manufacturers will often be charged 'slotting fees' in order that they get their brands in the best position," Ruth Marciniak, principal lecturer in marketing at London Metropolitan University, explained.
Bulk buys
Every decent shopper knows that the more you buy the less you pay. But again, you have to sometimes challenge the conventional wisdom.
I investigated ready-made lasagne last week and the results were interesting. Yes, the bigger packet at 950g worked out the cheapest at £3.63 a kilo. The smallest lasagne at 400g was the equivalent of £3.75 a kilo, so quite a bit more expensive.
But the really costly purchase was the medium lasagne at 550g, which cost £3.80 a kilo. Of course, the average shopper is not going to calculate the cost per kilo. They will look merely at the packet price.
Not so special offers
A supermarket wouldn't be a supermarket without a special offer or two. But are they really special and do they really save us money?
I was recently seduced by the Marks and Spencer "Dine in for £10" offer, which has since been copied by a number of other stores. The offer includes a main course, side dish, pudding and bottle of wine for £10 - enough for two people to enjoy a dinner at home.
The offer is appealing. I apparently saved £7 on the normal price of my four purchases. But, of course, I didn't just buy the four items for £10. I also filled my basket with all sorts of other goodies, running up an impressive total bill.
And when I got home, I realised that I really only wanted two of the dishes on offer. So, if I had bought the two items I actually wanted, I would have spent less than the £10. Clever, isn't it?
Special offers are a good way of pulling customers into the store - and once they in the store, customers will presumably spend, spend, spend. They can also help supermarkets to offload unwanted stock. If a buyer has ordered too many fresh chickens or it's been a bad month for ready-made moussaka, it can go on offer and fly off the shelves.
Of course, I'm not saying that offers do not represent good value for the customers - sometimes. It's just not necessarily all about the customer.
The incredible shrinking groceries
Would you notice if a manufacturer shifted the weight of your goods? Would you be able to tell, for example, if you bought 550g of mayonnaise instead of 600g?
You probably wouldn't, especially if there was no discernible difference in the size of the jar. Or what about 10 daffodils in a bunch instead of 12?
But it can happen - and it's known as downsizing. So be on your guard for a price hike disguised by a weight loss.
By Naomi Caine, writing for MSN Money
March 11 2009
If you go down to the supermarket today, you'd better watch out. Did you know that a team of retail managers, marketing experts and psychologists has already been hard at work to make sure the store squeezes every last penny out of every last customer? But with our handy guide to the tricks of the retail trade, we put you back in control of your trolley.
Smell the money
Supermarkets often waft delicious smells into their stores and even their car parks in order to make us feel hungry and pile more into our shopping trolleys. So, that lovely smell of freshly baked bread or seductive scent of vanilla is all about money.
The layout makes you pay out
Ever wondered why staple foods are always at the back of the store? The answer is simple but cunning. If you have to pass lots of other goodies on the way to pick up your bread and milk, maybe some will end up in your basket.
Cost a packet
You would expect packaged fruit and vegetables to be more expensive than the loose variety, wouldn't you? After all, someone has to cover the costs of the packaging materials and the labour. And you only have to look at broccoli in my local supermarket to prove the theory. The green stuff in a cellophane wrapper costs £2.93 a kilo, compared with £1.98 a kilo for the loose variety.
But you would be wrong to think that packaging always costs a packet. Carrots, another staple vegetable, cost 87p a kilo loose, but a cheaper 78p a kilo in a plastic bag.
You can even find more exotic vegetables that are cheaper in a packet. Take peppers. I could buy a bag of three mixed peppers for the equivalent of 46p each in Tesco last week. The same peppers loose cost 63p each.
So why do supermarkets sometimes price their packaged foods more keenly than their loose items? Well, you can actually end up spending more on the packaged food, even though it's cheaper.
Let's look at those peppers again. If you bought the pack of three peppers, you would spend £1.38. But do you really want three peppers? If you could manage with two peppers, you would spend just £1.26.
It's the same with the carrots. The bag is a kilo, so costs 78p. But you might want only 500g, so you could spend 43.5p on half the weight. Yes, you are paying more per pepper or per kilo, but your total food bill will be less.
The butcher, the baker....
Most supermarkets these days have a separate butcher, baker, even fishmonger. And most shoppers presume the produce at the specialist counter is more expensive than the mass produced stuff on the shelves.
But is it? Last week, I found an 800g granary loaf at £1.00 in the bakery, but £1.58 on the shelf. I could also have bought lamb chops for £12.98 a kilo at the butcher's counter, compared with £13.98 a kilo on the meat shelves.
How low can you go?
When you are browsing round a supermarket, where do you look? You might take each aisle in turn, but do you really scan every shelf? Few of us bother to look at the bottom shelves because it's awkward to stoop down - or embarrassing to grovel on the floor for your purchases.
So that's where the supermarkets stock the low-cost food - somewhere you rarely look.
The pasta aisle was a revelation in a nearby supermarket. At eye level you can choose from a wide range of pasta sauces including Loyd Grossman and Jamie Oliver. The pasta is also a recognisable brand.
But when I managed to lower myself to the bottom shelf, what did I find? There were packets of cheap own-brand pasta. Sauces were also inexpensive. I picked up a jar of simple pasta sauce for the equivalent of 17p per 100g; that's about half the price of a Dolmio sauce.
There's another way the supermarkets can make money out of their shelf stacking. "Manufacturers will often be charged 'slotting fees' in order that they get their brands in the best position," Ruth Marciniak, principal lecturer in marketing at London Metropolitan University, explained.
Bulk buys
Every decent shopper knows that the more you buy the less you pay. But again, you have to sometimes challenge the conventional wisdom.
I investigated ready-made lasagne last week and the results were interesting. Yes, the bigger packet at 950g worked out the cheapest at £3.63 a kilo. The smallest lasagne at 400g was the equivalent of £3.75 a kilo, so quite a bit more expensive.
But the really costly purchase was the medium lasagne at 550g, which cost £3.80 a kilo. Of course, the average shopper is not going to calculate the cost per kilo. They will look merely at the packet price.
Not so special offers
A supermarket wouldn't be a supermarket without a special offer or two. But are they really special and do they really save us money?
I was recently seduced by the Marks and Spencer "Dine in for £10" offer, which has since been copied by a number of other stores. The offer includes a main course, side dish, pudding and bottle of wine for £10 - enough for two people to enjoy a dinner at home.
The offer is appealing. I apparently saved £7 on the normal price of my four purchases. But, of course, I didn't just buy the four items for £10. I also filled my basket with all sorts of other goodies, running up an impressive total bill.
And when I got home, I realised that I really only wanted two of the dishes on offer. So, if I had bought the two items I actually wanted, I would have spent less than the £10. Clever, isn't it?
Special offers are a good way of pulling customers into the store - and once they in the store, customers will presumably spend, spend, spend. They can also help supermarkets to offload unwanted stock. If a buyer has ordered too many fresh chickens or it's been a bad month for ready-made moussaka, it can go on offer and fly off the shelves.
Of course, I'm not saying that offers do not represent good value for the customers - sometimes. It's just not necessarily all about the customer.
The incredible shrinking groceries
Would you notice if a manufacturer shifted the weight of your goods? Would you be able to tell, for example, if you bought 550g of mayonnaise instead of 600g?
You probably wouldn't, especially if there was no discernible difference in the size of the jar. Or what about 10 daffodils in a bunch instead of 12?
But it can happen - and it's known as downsizing. So be on your guard for a price hike disguised by a weight loss.
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