Comparison Shopping - How stores work against you.

I remember how cool it was when stores started putting "extra" information on the shelf tags to make comparison shopping easier. This was, of course, years ago.

I've been slowly putting together a price book of all of the "everyday" prices at stores in my area for the things I buy regularly. The first time I took my note sheet along, I was far too trusting. I thought to myself "Well, they list the break down on the tag on the shelf!". I ended up coming home with a sheet scribbled all over with prices and weights and volumes. Some time later, with the help of a calculator and a lot of patience, I had the pricing broken down into usable form.

Not surprisingly, the best prices are on weird combination. As an example, the 3.8 ounce box of Splenda is the best value at my local WalMart - by about 5 cents an ounce. No one buys that one, because the "price comparison" information lists "price per pound" (which is insane) while most of the other sizes of Splenda list the "price per ounce". Too hard to do the math on the fly, people just ignore that option and choose from the others.

I didn't have time today to check other items, but I've noticed it in the past with Olive Oil, Coffee, Cheese and other staple (for me, anyway) items. The best price is one of the choices that is listed differently from the others. I'm going to do a little research over the next week or so and see what I find out. In the meantime, if you want to comparison shop, take the time to use a calculator - your wallet will thank you.

"Responsible Lending"

Over the weekend, I attended a function that included lunch. At the table behind me, I overheard 2 people talking about how several friends were in tight spots with their mortgages. That didn't surprise me, but as their conversation developed, I was dumbfounded when the blame was placed entirely on the mortgage lenders.

I'm not saying that mortgage lenders weren't making bad loans, but at some point, don't the consumers have some responsibility to read what they're signing? Didn't we all grow up hearing things like "let the buyer beware", and "if it sounds too good to be true, it probably is!"?

The conversation touched on the fact that the lenders should have told people this or that. No mention of the obvious - that the lenders don't work for the borrowers, the lenders make their money from the borrowers. If the borrower (customer) wants someone "on their side", they need to (and should!) hire a real estate attorney to look over the contracts before they sign them.

The lenders were irresponsible - to their share holders. Those are the people they have a responsibility to. They were irresponsible because they sold people more than they could afford. Really, the lenders are responsible for figuring out how much they can get out of a borrower without forcing the borrower into default. If that means the borrower eats nothing but ramen noodles and rides a bike to work for the duration of the loan, it just means that the lender got the best deal they could for the people they ARE responsible to - the aforementioned shareholders.

The person that is responsible for making sure they don't spend more than they can pay is the borrower.

The thing I find truly scary about this is that I'm a complete idiot when it comes to money and finances. I've just recently figured out how to actually make a budget, and even I know the basic rule "don't spend more than you have". How much worse off are these hundreds of thousands (millions?) of people that are caught in the mortgage crunch if even a self-acknowledged "financial idiot" knows more than they seem to?

Reciepts Required...

The Consumerist has an interesting article this morning on Barnes & Nobel changing their return policy. Now, I'm all for businesses changing the return policy to stop rewarding shoplifters and scammers, my problem with it is that even though they end up saving a ton of money in the process, prices don't go down. The end result? More hoops for innocent shoppers to jump through, but no benefit to them. The store gets to save money, the stock holders may see a bigger dividend, the store posts a higher profit margin, but the little guys still get screwed. Think the employees get a raise? I doubt it.

Maybe it's time for "Retail Unions". Credit Unions provide banking services, but since they're non-profit, the focus is more on the members (also known as "customers") rather than the profit margin. What would the result be if a store adopted that philosophy?

Could you imagine the screening process? You'd want to eliminate anyone that might shoplift, scam, or damage anything. Check arrest records? Credit Reports? References? Suddenly, just telling people you're running an errand could become an exercise in snobbery. Oh, and what about kids? Allow them or not? Require parents to sign a waiver accepting financial responsibility for any extra cost their kids cause? How much does it cost to have an employee clean up that smashed display, or mop up the broken apple juice bottle because the little darlings were running wild?

Still, I think that might be somewhere I wouldn't mind shopping. It's extremely rare that I ever need a store to go "above and beyond" for me, yet there's no question that I pay a little extra for everything I buy as a result of the people that do end up making stores go "above and beyond" on a regular basis - unruly kids, "Women of a Certain Age", scammers, etc. etc.

Perhaps its' time to start letting those types of customers pay their own premium.