Money Myths: Buying in bulk is cheaper

When I was in grade school, my Home Economics teacher told us that buying in bulk is cheaper.  I used to believe her until my own experience proved otherwise.  When I started being savvy in the grocery, I noticed that items packaged in bulk aren’t always cheaper than buying them in smaller, regular sizes.  Plus, it’s not always the wisest decision to buy products in bulk.

Still, products sold in bulk are usually cheaper.  If you do it right, bulk buying can give you more opportunities to save.  Here are some basic tips:

Always do the math.  If you carry a cellphone with you at all times (you’re Pinoy, so you probably do), you have a calculator.  Use it.  Find out how much the product costs per unit (gram, mL, piece) for the regular packaging, and how much it costs per unit for the bulk packaging.

Here’s an example.  A 100 gram bar of soap costs P17.00.  When the same soap is sold in packs of 3, each pack costs P45.00.  Which is cheaper, the 90 gram bar or the 3-pack for P45.00?

If you multiply how much a single bar costs (P17.00) by the number of bars in a pack (3), you’ll find that buying 3 individual bars costs P51.00.  Since the 3-pack is only P45.00, buying it would be cheaper.

Be careful, though.  Some manufacturers decrease the per-item weight of products in bulk to make buyers think that they are getting things cheaper. In the soap example given above, make sure that each bar in the pack is also labeled 100 grams.  Sneaky manufacturers might use 90 gram bars in the bulk packages.

Don’t worry about the math-induced headaches you might get.  It’s likely that you only have to do it once for each product you want to buy in bulk.

Buy non-perishables. Items such as toilet paper, plastic bags, dishwashing liquid, and other non-perishables are okay to buy in bulk.  They won’t spoil easily and won’t be a hassle to store.

You can only safely buy perishables in bulk if you know how to preserve them, will consume them soon in large quantities (ex. if you’re having a party), or if you have assurance of the product’s quality.  I found this helpful guide on how to freeze different food items.  Worth looking into if you want to consider buying food in bulk.

Consider other factors that are important to you.  We’ve already mentioned quality.  If quality is important to you (and it should be), you need to take that into account before buying a product in bulk.  After all, it isn’t a frugal choice to buy toilet paper in bulk if it breaks away easily and doesn’t absorb too well.

Another factor you may want to consider is how environmentally friendly your bulk purchase is.  Sometimes, products that are packaged in bulk are prone to excessive packaging – there’s one big plastic bag wrapping the bulk of the product, individual plastic bags wrapping each item, etc.  If you think a certain bulk purchase is less environment-friendly than its regular equivalent, then don’t buy it in bulk.

Know where to buy.  Makro is a good place to start buying in bulk.  Their bulk products are usually cheaper, especially the generic ones such as Savepak and Aro.  I’ve already talked about the good quality of the Savepak dishwashing liquid, so it isn’t necessarily true that branded products are better.

You can also go straight to the manufacturer if you want to buy a product in large quantities.  In fact, you might get it cheaper there.

The next time you think you’re getting a great deal from a bulk purchase, stop for a minute, do the math, and consider if you really are getting a great deal.  My Home Economics teacher was mostly right.  Buying in bulk can be a great money saver, but only if you do it well.

Photo Credit: Image from Luis Rock  from stock.xchng

Money Myths: Expensive Wine Tastes Better

It’s  going to be my 25th birthday soon, and I want to celebrate the occasion with some wine.  But buying wine can be intimidating especially if it’s your first time.  Many people say that the more expensive a wine is, the better it tastes, but this isn’t necessarily true.  Here are some ways to make informed wine purchases:

Know that it’s all in the mind.  I came across a study that showed how pricing controls people’s enjoyment of wine.  Here’s a basic description of the study:

Dr Rangel gave his volunteers sips of what he said were five different wines made from cabernet sauvignon grapes, priced at between $5 and $90 a bottle. He told each of them the price of the wine in question as he did so. Except, of course, that he was fibbing. He actually used only three wines. He served up two of them twice at different prices.
Source: The Economist

The results? People said they enjoyed the “more expensive” wines, even if they were exactly the same as the less expensive wines.  A blind tasting version of the same experiment where no prices were indicated showed that the volunteers could tell that the same wine was served twice.

In other words, people enjoy more expensive wines because their brain is playing tricks on them.

Decant it.  In the old days, decanting was done to remove the sediment from the wine.  However, the wine making process has improved since then, and nowadays decanting is done to mix the wine with air and open up the flavors.  Doing so makes the wine less acidic, compared to serving it just after uncorking.  This is especially important for young wines, and it can make inexpensive wines taste much better.

Note that you don’t need a fancy wine decanter to do this.  In most cases, a glass pitcher will do.

In this video from WineLibraryTV, Gary Vaynerchuck talks about the benefits of wine decanting and how to do it.

Go with your own taste.  Only your tastebuds can measure how sulit your wine purchase is, so go with what you like.  If you really don’t like that P200 wine, don’t buy it.  It’s just like throwing P200 down the drain.  Conversely, if you don’t like an expensive wine, don’t buy it either.

Learn about wine.  The more you know about wine, the less intimidating it will be to shop for the best deal.  You won’t be subconsciously forced by salespeople to buy the most expensive thing around.  Here are some great resources to learn more about wine:

• Cork’d – a site with user-submitted reviews on different wines
• Wine Library TV -videos about wine, presented by the entertaining  GaryVaynerchuck
• Wine for Newbies – a blog about wine for those who are new to it

The next time there’s a special occasion that calls for wine, it’s important to make an informed choice.  Doing so can not only stretch your peso, but expand your enjoyment as well.
What wines have you tried? Which did you like best, and how much were they?