Received an insightful comment from S.B. at Retire At 45 following my Wegmans post:
I love Wegmans, but I have to be careful there! Just like Costco, they have a trade up / trade down business model. The prices (and selection) on the basic stuff are great, but they also tempt you with a lot of high-end, high-margin stuff. I need to maintain discipline when I go there because of that.
I've never heard it put quite that way but it's true. I've even fallen for it a bit. Bananas are 49 cents per pound at Wegmans, which is cheaper than other places we shop by about a dime per pound. Nearby, though, they have summer truffles available, for a cool $15.62 per ounce. (They're under lock and key, naturally.) And there are so many premium beers to try. Costco is the same way: You can get 50 pounds of rice for $20 … or jacuzzis for $3,000. The high-price, high-margin stuff is right next to the great deals.
Other kinds of stores work like this too. Gas stations sell gasoline at a loss (after merchant fees) but jack up the prices on the incidental snack items in the store. Restaurants sell food reasonably priced but make a killing on drinks and appetizers.
If knowing is half the battle, just realizing that this product placement is deliberate helps. So, like S.B. recommends, just go in for deals and bypass the gourmet items. Or pay at the pump when you fill up because gas stations are great places to buy gas, but lousy places to buy a lot of other things.
(Thanks to Suburban Dollar for including this in the Money Hacks Carnival!)
The trick is balancing time and money. If I can get 80% of what I need at a good to great price and the other 20% at an acceptable price, that’s worth more to me than driving to another store, etc.
My time is worth more than the money I would save.
That being said, I also spend one afternoon a month going to the circle of stores I use and stock up on things at their best prices. Planning ahead and sticking to the shopping list go a long way towards saving money.
I read an article that mentioned how Costco makes a lot of their profits due to the product placements in their store. They are so tricky and so good at how they place the right products next to the deals that they can pretty much assure that they will get a nice amount of sales if they do this. I will try to find the article for you.