I was inspired to do this experiment after an article on Yahoo Finance about ways to save money on food. One of the suggestions to save money was to switch to generic products. What really inspired me was a discussion of this article in the frugal forums and one person noted that she actually really can't afford to buy generic products because she saves more by buying brand name products with coupons.
So I decided that I would do a little experiment. I took ten coupons that are currently good to use and came from Sunday newspaper coupon inserts for different food and household items. I would price those items at my grocery store and see what came out cheaper the brand name product with coupon or the generic product.
However, I had to account for a couple of things. Not everyone shops at my grocery store. So I decided to price these items at a national grocery chain: Super Walmart. Also, for a couple of these products Walmart didn't offer a generic product so instead I compared to the cheapest available on the shelves.
Like I said my sample was very small: only ten coupons. You can see the results of this experiment here. But the results are this: I would spend an extra $0.48 at Walmart buying these brand name products even when using a coupon to purchase the item. But because the person who originally made the comment that inspired this experiment shops at a grocery store that doubles coupons, I decided to run the scenario where coupons up to a face value of $0.99 where doubled at Walmart. Walmart does not double any coupons but I wanted to see the difference that would make. Some of the coupons I chose could be doubled and after they were doubled I saved $1.41 by using coupons if Walmart doubled coupons.
Having to price these items at Walmart gets rid of a significant variable that leads to bigger savings when using coupons: grocery store sales. Because of its "everyday low price" Walmart very rarely has sales that can compare to loss leader sales grocery stores have. The fact is that you can find some items cheaper at your grocery store than at Walmart. Therefore, if you were to perform this type of comparison at your grocery store you could observe greater savings after using a coupon.
Not very much can be inferred from my experiment due to the small sample and the fact that I had to price these items at Walmart. However, I do think that having a grocery store that doubles coupons can lead to greater grocery shopping savings when buying some brand items than buying the generic product. So, if you have a grocery store that doubles coupons near you and you are not taking advantage of it consider start doing so, you may be wasting a great source of savings.
If anything, I hope that this little experiment leaves you wondering about whether you should conduct an experiment of your own and identify items that are cheaper than the generic alternative if you use a manufacturer issued coupon.
UPDATE: I have updated the spreadsheet and the results to reflect the point made by Jennifer: That in order to properly calculate savings I had to "purchase" the amount of products as stated in the coupon for both the brand name item and the generic brand.
Thursday, March 13, 2008
A Little Grocery Shopping Experiment - Updated
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10 comments:
Actually there is a flaw in your spreadsheet. If you factor in the quantity required to use the coupon, that would be your real savings. Otherwise you can't use the coupon. So, for example the first item you have to buy THREE things, the spreadsheet should include buying 3 Name brand and 3 store brand. By factoring in the required purchase amounts, you only save $0.22 (without double coupons).
Hi Jennifer,
Thank you so much for making that point. I have updated the spreadsheet and I hope it is right now. I have savings of only $0.48 instead of 0.22 as you said. If you can spot the difference and my calculation is wrong please let me know.
Interesting experiment! I might try that with some coupons of my own.
For me, I rarely use coupons for my groceries anymore. I just go to Aldi.
Coupons work best for me when they're for toiletries and paper goods. I take those to the drugstores when I need to stock up and when they're on special promotion.
Are the findings of this experiment going to change your couponing any? I see that you've saved a TON already this year with coupons. What do ya think?
Hi Kacie,
No, these findings won't change the way I use coupons because of these two things:
1) Like I mentioned in the post I find the best use of coupons is when combined with a good sale (usually loss leader sale). So I can save more money if I use my coupon at the grocery store, unless I do Price match at Walmart.
2)I have realized that insert coupons are not all the coupons that are out there but a subset of them. Right now I have in my coupon binder coupons for milk, any meat and salad. Those didn't come from sunday newspapers but from coupons found in tearpads or winetags at the grocery store. I used to say that there weren't coupons for the things that I use, but there are, you just need to look for them.
I guess the best thing to do is to use a combination of store brand and name brand bought on sale with coupons.
I have been tracking my coupon use this year and it really isn't much. There aren't many coupons out there for produce and meat and emma's food. I have really been shocked at how little I am using, I feel like I spend so much time and effort couponing and now realize that it doesn't benefit me that much.
Great little experiment! I always thought that buying generic was cheaper.
But once I started couponing a few years ago, I soon realized that when I combined the store sales with coupons and only shopped where they double coupons, then the name brands were most times cheaper! So then I would stock up.
Of course this isn't always the case because some name brands don't offer coupons or their coupons are for too low amounts, so then the generic is probably a better price.
I guess it's just one of those things where you gotta do your homework and be aware of prices if you really want to get the best deals.
I have been a die-hard, price matching Wal-Mart shopper for almost 3 years now. I stopped using coupons b/c I found that usually the store brand was cheaper at Wal-Mart (where I shopped).
Two weeks ago I took up couponing again and I am finding that if I use coupons when an item is on sale at a grocery store I save TONS of money! And when I can do that with household goods (soap, TP, toothpaste, etc) it saves me money to buy things that usually don't have coupons (milk, eggs, meat, etc). If you don't double up the coupon with a sale, it isn't that big a savings. But with sales, rebates and store coupons -- I am saving loads of cash!
I used to leave in an area where grocery store doubled coupons, not I live in the "land of no doubles." I swear next time we move I am going to require that we move to an area where grocery stores double coupons.
A big key to using coupons is not to just use them when you get them that week. Hang onto them until the items go on sale. For instance, if a store is having a buy one get one free special on your brand of cereal, you figure out what the price PER BOX is, then your coupons (and if they double)...once that's figured in, I often can get a box of cereal for $1.25 or $1.50, instead of $4 or more.
See Using Coupons for more tips. I have several pages on that site that may be of help.
Thanks Darla for the tip. I agree that the best way to maximize sacings with a coupon are to combine them with a great sale!
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