There are a lot of supporters of bulk buying. We are told that it is an easy way to save money. I have been known to buy a gallon of vanilla here and there. However, when evaluating the savings of buying groceries in bulk, it is important to equate for the bulk buying psychology when you calculate the savings.
Is Bulk Cheaper? The Traditional Calculation
1 package of popcorn = .50 cents
25 package of popcorn = $7.50 or .30 cents per bag
Mathematical conclusion – buying popcorn in bulk is 40% cheaper than buying popcorn individually.
Is Bulk Cheaper? Including Psychological Factors in Your Calculations
When Buying In Bulk, You May Purchase More Than You Need
I sarcastically said that I’d buy a gallon of vanilla. However, time and time again people who shop bulk buy massive quantities just because it is cheaper. In this case, I am the chief of sinners. Here’s a sample conversation:
Me: “Hey, love, I just got this huge jar of pickles for $5.00.”
Wife: “You do know you’re the only person in the family that likes pickles, right?”
Me: “But, it was only $5.00”
Wife: “If you bought a jar for $2.50, it would have lasted you just as long. These things will spoil before you eat half of them.”
Me: “Well … what if we invite a big group of people over and … well … one of them has a pickle addiction and they have to eat a pickle every 20 minutes to survive? Yeah. Won’t we be glad that we have pickles then?”
Wife: “ You’re so _____________ (this blank line varies too much to know exactly what wife will say).”
By the way, the names Me and Wife are intentionally anonymous so as to protect the innocent.
When Buying In Bulk, You Are Likely To Consume More Than Usual
So, what do you think is going to happen if you have 100 pickles in the house?
Pickles and eggs for breakfast, pickle sandwich for lunch, and pickle fried steak for dinner.
When you buy food in bulk, you consume more. Instead of having one pickle once a week, you will have 4 pickles every week. As a result, you literally eat away the savings.
I think this is especially true of drinks and snack foods.
As a side note, one thing you can do when you find a great deal is to buy extra items as inventory to sell ebay.
When Buying In Bulk, You May Be Comparing Apples To Oranges
A person who typically buys an off name brand might pay .35 cents for a can of soup. The person who buys the name brand might pay .55 cents. However, if you buy the name brand bulk you only pay .40 cents.
A person who has no problems with the no name brand might actually start buying the name brand product just because they are saving .15 cents per can. However, when compared to the no name brand, they are actually paying .05 cents more per can.
As a result, a related disadvantage is that you might buy a more expensive option just because it is cheaper than a single purchase of the name brand.
Is Bulk Cheaper? The Conclusion
In many cases, I would say that buying food in bulk is cheaper. Just remember you ultimate goal is to save while shopping.
However, you should be aware of your spending impulses to be sure your price savings are not being reduced by buying more, consuming more, or changing your spending habits.
Don’t just use a straight mathematical calculation. Be sure to calculate some extra costs associated with the above three factors.
Photo by functoruser.
Do you buy groceries in bulk? Have you noticed any of these three psychological factors? Which do you think adds the highest extra cost when it comes to buying food in bulk?
{ 12 comments… read them below or add one }
The soup example reminds me:
It’s always a good idea to compare unit pricing on various sizes of the same product. I’m finding a LOT of instances where the “economy size” of a product – especially soup – has a higher price per unit (ounce, pound, etc) than the “normal” size.
Many items – including soup – can be stored in resealable containers and refrigerated or frozen for future use, and make good buys in larger sizes when pricing is favorable, but in many cases the pricing isn’t favorable for larger sizes.
We used to buy in bulk and you know what, in that year we racked up most of our credit card debt! I tried going back to bulk for some items and have learned, in most cases, it does not work for us. Either the food item goes bad, we forget we have it, or we throw it out just because. I find we have much better luck sticking with our budget by planning meals, buying items on sale we would buy anyhow, and only buying what we truly need.
I’m single so buying in bulk makes little sense for me. Some of the food would likely go bad before I ate it all so that would be wasting money in my case. I’m guessing its good for a family of 2 or 3 or more….
Most items go on sale are a better value than in bulk. I do buy oatmeal in bulk not only because it is cheaper that way but I like the oatmeal they have in bulk at the co-op.
I think buying in bulk for a family of five makes plenty of sense for their staple diet items. Since its just my wife and I at home, it doesn’t make much sense and we don’t save more money. Besides we already waste food when we buy too much of something and it spoils before we get a chance to eat it. That’s why I like going to the grocery store more often and buying less each time I go. It helps prevent food spoilage and I can get in and out quickly and not make a big trip out of it.
We have two sons in athletics. (Need I elaborate?) Buying in bulk, (loss leaders in large quantities), makes tons of sense for things like peanut butter, non-fat dry milk, ramen, and tuna. Beets and lima beans are another matter. Once the kids on their own, we’ll reevalute our system, but right now it’s the only way to fly.
In my home, there are certain things we buy bulk, and certain things we don’t because we have the prices at different stores memorized, we know exactly how much we are saving when we buy at different stores. One thing is for sure, if we can save .10 cents a can by driving forty five minutes away, we probably won’t do it. (The regular grocery store is less than a minute away.) Comparison shopping, without wasting expensive gas, is key. But then again stressing over .05 cents doesn’t really do anyone that much good… Take it easy, learn the values, get a system.. Make it stress-free.
We’ve had to learn which foods are worth buying in bulk, and which are best purchased at the grocery store, but overall, bulk is best for our family of 7. If you have 5 gallon storage pails, I’d say whole grains (and beans) are definitely best bought in bulk if you grind your own flour and bake your own bread. (Especially since they don’t go bad, like dried fruit and pickles.) We save literally hundreds of dollars a year on grain alone.
It’s always worth it to reconsider your system and be sure you’re not wasting gas (or food) to save a couple dollars. Thanks for the post!
Liz
One factor no one has mentioned is the issue of storage. When we buy in bulk we have to keep inventory. Living in NY where space is a premium, it is expensive to have to store the goods after they are bought. This should be calculated into the cost of the items.
Having lived in NY, I can agree to a point. But there are ways to find “hidden room” in the older higher ceilinged apartments at least. Putting shelves above doorways, or above windows, under bed wheeled units, “loft” beds, storage that hangs on doors, etc. These may not be elegant solutions, but storage is there. Even one-can-deep shelves give you a good bit of stashing space.
I agree, but it just goes to prove my point that storage is one of the intangible costs of buying in bulk. Because the items are “stashed” your space is reduce by the corresponding square footage and this space could be put to other uses.
Thanks for the information, helped me out a lot. Considering it, I was never really sure whether it could be done this way.