2. Bargain does not necessarily mean win.
When you see a “sales” sign or sticker, or hear your favourite store has just moved that jacket you want to the clearance section, you might get a little giddy. Saving money? Yes, please! However, sales aren’t always what they seem. In fact, you could end up giving the store more money during a sale than you would have on a normal day.
It might sound impossible, but retailers know how to work the sales system to bring in business, which means your wallet might be a little lighter. Here are few things to keep in mind:
Have you ever gone bargain hunting, where you shopped only for items with deep discounts? This happens to most people on Black Friday, and most people lose at the end of the day. Why? Because most of the stuff they bought were not part of their budget nor did they need it. Remember this important principle…
If something cost R1000, and it is on sale for R750, and then you decide to buy it, you did not save R250. You spent R750.
The key to bargain hunting without breaking the bank comes down to a simple yes-or-no question. Were you already planning to purchase the items you’re looking for?
If you answered yes, then spotting those items on sale is a win indeed! You already budgeted for the belongings and know you can afford it. And now, instead of spending full price, you’ll keep a few rands in your pocket. Overall, this is a success.
If you answered, no, however, retailers have got you. When you buy something on sale you didn’t plan to purchase, you’re going outside of your budget. You’re using money you intended to spend elsewhere, which could either mean you can’t spend as much on groceries this month, or you’ll exceed your spending limits. Neither is a good option.
Another way customers lose out is on loss leaders. Loss leaders are items the store loses money on. They’re typically things you buy often, or that you come to the store to purchase. For instance, Dates (Kajoor) at the time of Ramadaan are loss leaders, as some shops sell it below cost.
But, the store relies on you purchasing more than just the Dates. Around Ramadaan, you’ll also buy milk, sauces, savoury fillings, etc., and these items will cost more, making up for the dates loss. On Black Friday a store might mark down a pants by 80%. Wow, what a saving. But they know that with the pants you will buy the matching top, shoes and maybe even the hat. The profit on those items will make up for the loss of the pants.
If you take anything from this, it’s to always follow the golden rule of discount shopping: Only purchase things you planned to buy in the first place.