The Shopping Cart Economist

It’s bad enough that we have to do laundry at all. It’s a total PITA to get it done, washed, folded, and put away, but then to have to pay more for laundry detergent to get it washed??? It’s enough to make me switch over to disposable clothing and edible underwear

What’s the big deal? For years, the industry standard for laundry detergent has been 100-ounce bottle for liquid (note, I don’t use powder, so I can’t speak to sizes/prices, other than to say there is some increase happening there). I am sitting on a stockpile of Arm and Hammer brand detergent that I bought last year which were 100-ounce bottles. A quick check on the detergent aisle shows me they’ve switched the bottle size to 80-ounces instead. My 100-ounce bottle says it’s good for 32 loads. The 80-ounce bottle says 51 loads. The price for Arm and Hammer has stayed relatively steady. At Walmart (which is rare for me to walk into) the price was $4.97 yesterday for the 80-ounce bottle. Last year’s price for the 100-ounce bottle was similarly priced. It’s important to note that Walmart is usually about 10-20% less than traditional grocery stores like Safeway or Albertsons for cleaners, so from quick memory, I think the Arm and Hammer at Albertsons is closer to $6.59 to $6.99 not on sale.

So, if the ounce size is less, but the load size is more, and the price is relatively similar, why is this a problem? Using Walmart’s pricing, the price in the old bottle was 4.9 cents per ounce. In the new bottle, it’s 6.2 cents per ounce. Less in the bottle, even with the supposed increase in load size doesn’t change people’s washing habits that they’ve had for years….most are still using a capful regardless of the directions on the bottle. So Arm and Hammer winds up taking consumers to the cleaners, literally! Having front loading machines and being conscientous of the environmental impact of detergent, that 100-ounce bottle does last me more than what the bottle says it will, but for general shoppers, they are pouring money into their wash machines with every load.

And it isn’t just Arm and Hammer. Tide has had a HUGE price increase in a year. Again, using Walmart prices, 100-ounce Tide was $12.83 for between 48, 51, or 64 load capacity depending on the flavor of detergent you were buying. This is up from $10.99 just a year ago, and less the year before. The 100-ounce ALL detergent - $8.44, up from $6.99. Even Purex, historically a low-priced brand was sitting at $5.97, up from $4.99 a bottle. Again, factor higher prices from your regular grocery store versus Walmart’s pricing here, and you’re paying even more than you were a year ago to do the wash.

And then of course, there’s the proliferation of concentrated detergents like All Small and Mighty professing to be 32 loads for $3.99….I have yet to get 32 loads out of that bottle, even as a conservative user.

So why the change in bottle size? Quite frankly, it’s a bulky product taking up lots of space on a truck. The smaller the bottle, the more that can ride on one semi-load. And if the price per ounce is up, but your personal consumption hasn’t changed, then the detergent companies are the only winners in the laundry wars that happen in American households everyday.

If you want to avoid being squeezed on detergent prices, some easy advice would be to stick to branded, but less marketed brands like Arm and Hammer and Purex. Tide is notoriusly expensive with dismal coupon values. Use significantly less detergent. If it calls for a full capload, try a 1/4 cap instead. What’s cleaning your clothes isn’t the soap…it’s the process of being agitated in the machine and being rinsed through the water. I mean come on, people used to beat their clothes with rocks in the river and that did the trick just fine! Lastly, don’t buy the detergent when you need it, and don’t be brand loyal. This is one item you can get away with trying to save on, unless you have some specifically weird allergy to detergents. Buying and stocking up when it’s onsale will save you from paying full price later, and switching brands when they have high dollar coupons that match the sales will help cut costs.

Key takeaway - don’t wash your money down the drain. Pay attention to the price per ounce and don’t be fooled by load size per bottle - it’s a meaningless and shameless marketing tactic.

Blame it on global warming? Well, blame it on something. Mother Nature has had a heck of a time with wreaking havoc on world food supplies this year, and the floods in the Midwest is going to be another factor in the equation as we continue to see food prices jump, particularly in the sectors that are going to be most devastated from busted levees and high flood waters….corn and soybeans.

The USDA estimates that nearly 10% of Iowa’s corn crop and over 20% of the soybean crop is damaged. We’ve already seen an estimated 20% increase in the cost per bushell of corn since the beginning of the month. And the damage estimates are conservative estimates by all accounts.

What’s troubling is that this not only has an effect on the food markets, but since a chunk of the corn being produced in Iowa was being diverted to biofuels, we’re likely to see a ripple in that market as well.

Here’s the rub though. With 2 million acres of soybean crops damaged, vegetable oil is going to skyrocket. It already was high. In fact, I had planned to do a blog specifically about how now was the time to cut that Southern fried food out of your diet since cooking oil prices were so high. A recent price check showed me that vegetable oil brands like Mazola and Crisco, both soy-based oils, were already pretty high at $5.99 to $6.29 per 48 ounces. Give this a few weeks to shake out, and I think we’ll see prices climb closer to $8 for those same size bottles. There’s no way that the already troubled market will bear holding prices at what was already a high amount when 20% of one state’s crop has been damaged. Mazola oil last year this time? You could easily get it on sale 2 for $4 and even better with coupons. Now it’s a loss leader at 2 for $8.

Corn oil isn’t much better. A few weeks ago, that same 48-ounce bottle was sitting at $6.99, so I expect that we’ll see that push even higher past $8 and possibly even close to $9 a bottle.

One more blurb on oil - your best bets are going to be canola oil and even olive oil. Canola oil is the best choice sitting at $4.69 a bottle for branded like Mazala and Crisco, and even less at $3.59 for the store brands.

So, we know that the vegetable oils are going to be even higher now, but what about other parts of the grocery store? Anticipate anything that’s corn or soy based to just be expensive. That means from cereal to tofu, American consumers are about to feel another stabbing thorn in already high prices this summer. What makes this whole thing even more frustrating is that we had such a cold winter, some farmers in the midwest never even got their crops in the ground, so there’s also acreage that went unplanted this year, which will cause some additional shortages in other grains besides the corn and soy markets.

What’s a shopper to do? Well, if you really are a large consumer of vegetable oils, grab some coupons and try to get the best deal on them now while you can. The same goes with some of the other foods out there. It isn’t likely since some of these crops were still a ways from being harvested that it’s going to affect current availabiity of supplies on the shelf at the current prices. Where we’ll really start to see that shift should be towards the middle to end of summer, and into the fall as the current crop would supply next year’s ingredient inventories. Or skip the oil and go on a diet….you could save a lot of money if the next wave of food price increases comes true.

If you like beer, it might be time to switch to wine. If you drink beer regularly, you’ve probably already seen the huge price increases in the price at the store or on the tap at your favorite bar.

This one is definitely not tied to the fuel market…it’s all about the hops. Hops is one of the main ingredients in beer making. In the US, we’ve reduced our hops production in favor of other crops. But then bad weather in other hops-producing nations damaged crops last fall leaving a shortage that is affecting beer producers across the world.

Brands like Budweiser and Coors, who have such large purchasing power and can lock up producers, are going to be less affected by any shortages. Still, whether it’s fuel or hops related, Bud and Coors in my neck of the woods has gone up about $1.50 a case.

Where I’m really seeing the price change is in the micro-brew brands. These are the beers that are locally produced in many areas of the country. Of course, Portland, Oregon is one of the micro-brew capitals of the world, and brewers here were hit hard by the increase in cost of their main ingredient. On a recent trip through the store, I noticed as much as a $3 price increase per 6-pack. Beers that were once selling for $8.99 a 6-pack were now sitting at a regular price of $11.99.

The estimates I’ve seen is that most brewers were hit with a 20-30% ingredient price increase. But for those who do specialty beers (think organic hops), the cost increase was up by as much as 80%. It was enough of a hike that some beer companies were looking to see if they could even still qualify for the organic designation on their label if everything but the hops was organic since there is some kind of loophole for organic labeling if an ingredient is unavailable in an organic variety, that the producer could still claim organic.

So, what’s that mean for my beer drinking buddies this summer? It’s bad enough that a really choice steak is going to run you $10, but now tack on a $2 beer on top of that? Grilling in the backyard just isn’t as cheap as it used to be. If you’re drinking just to drink and get drunk, switch to cheap wine! If you’re drinking beer cause you really enjoy a cold brew, you might think about conserving your stash and drinking water in between each beer. Or, just skip the steak and drink the whole 6-pk at one sitting. Anyway you slice it, there’s not getting around the fact that beer, what used to be the mecca for those looking for a cheap drink, is just not cheap anymore. Experts say that they don’t expect this hops issue to be resolved anytime soon. Pressure on farmers to grow food crops (corn/wheat) and more weird weather on the horizon don’t look good for the hops market.

That said, watch for sales. There’s still pressure to sell beer, and beer is going to get competive as the market gets a bit tighter, and with people’s spending power in all market sectors diminishing. Keep your eye on the beer aisle when you hit the store, and if your favorite brand is on sale, pick some up then for sometime later. Beer has a great shelf life.

The other trick for cheap beer is a little counterintuitive for my supersaver friends who don’t eat out much, but go hit happy hour at your local restaurant (I love the $1.95 appetizers at McCormick and Schmicks). The beer by the glass is going to be discounted and in some restaurants, a 16z or 22z beer is actually going to be cheaper than buying a bottle at the grocery store for home consumption.

And my public service announcement - if you’re going to drink….don’t drive!!! Cheap beer isn’t worth an overnight stay at the gray-bar hotel!

Breakfast at the Parrish house is a big deal. With three boys, I really pay attention to the cost of breakfast ingredients. Not a weekend goes by that my husband isn’t pulling out the griddle to make pancakes and fry up some bacon for the kids. But in true Shopping Cart Economist form, the price of breakfast has been something on my radar.

If you’ve walked down the breakfast aisle lately, you might have done a doubletake at some of the prices. Think about the base ingredients though for breakfast and it all makes sense. Corn and wheat are two commodity items that have shot through the roof this past year, and those two items are almost predominantly in every breakfast item you’ll find.

Let’s start with a pancake breakfast. If you’re like us, you rely on using a mix for pancakes. While I don’t use Bisquick personally, it is the number one selling mix on the market. A 40z box right now is $3.99 which gives 28 servings. The price of Bisquick a year ago was between $2.29-$2.59 and was regularly on sale for $1.50 as part of General Mills line up of easy turn sale items. So while a jump of .08c per serving to .14c per serving doesn’t seem that much, as a percentage, it’s a 43% increase. And it’s fair to say that for most Americans, one serving isn’t really the serving size. That size box will only get my family through 1.2 breakfasts.

And if you want butter and syrup on those cakes….you’re going to really need to dig deep in the purse. A pound of real butter is currently selling for $4.69 average for most brands. And syrup is at an all-time high. 24z branded syrup like Mrs. Butterworths or Aunt Jemima is currently retailing between $3.49 and $4.89 with the best sale price being about $3.00. Store branded is a bit better at $2.59. Aunt Jemima, a Quaker brand, was last on sale for $1.50 a bottle when I bought it in October. I doubt we’ll see prices that low again. Note that the first ingredient in most brands of syrup isn’t Vermont maple syrup…it’s high fructose corn syrup. And with the corn markets still out of control, I expect syrup prices to creep up higher this summer. The cheaper corn syrup based pancake syrup is actually starting to come in alignment with pure maple, which was onsale for $3.99 for the Log Cabin variety. Of course, for my granola friends, organic maple syrup is even more outrageous at $7.99 for just six servings.

Moving on around the table, we’ve all seen the craziness of egg prices. While there are good loss leaders out there (I have two stores with .99c a dozen starting tomorrow), overall, egg prices are still well over $2.69 a dozen in most locations, and even Costco’s egg prices have inched up too. What’s worse however is the price of a pound of bacon. And beware - many brands are switching the traditional 16-ounce pack size to a 12-ounce pack size. One pound of many name brands with week are upwards of $6.99 a pound. It used to be just a short year ago that the only $6 and above bacon brands were Hormel Black Label and Fletchers. Now, even Oscar Meyer is over $6 a pound, up from an average of $3.49 a pound….nearly double.

Looking at blueberry muffin mixes, the one I have used as my price gauge has been Betty Crocker brand with the canned blueberries in the mix. Price before the rise of wheat hovered around $2.49. Yesterday, that same mix was $3.69 at Albertsons. I normally get about 12 muffins out of the mix, so the price change represents a 10-cent increase per muffin.

Cereal is one of the worst offenders for shrinking pack sizes. I bought a bunch yesterday using some rainchecks and coupons, but I was shocked to see many of the GM brands had dropped pack size again. A 10-ounce box of Lucky Charms (which had been a 12-ounce box previously) was regularly priced on the shelf at $4.69. My kids are going to eat at least 2 ounces in a serving, making each serving nearly ONE DOLLAR. So not only do I get a smaller box, the price has gone up significantly enough that unless you’re getting cereal on sale, it might not be the most affordable choice for breakfast.

Orange juice anyone? A branded 96z carton like Tropicana used to sell for $3.99. The price the last time I looked was over $6.00. And if you like Starbucks coffee at home, the standard bag on the grocery shelf has climbed from $9.99 to $10.99 in the last few months. The standard sale price which was once $6.99 is now $8.99.

Frozen Eggo Waffles, which used to be $2.19 and regularly came on sale $10/10 are now sitting at $2.99 in the store for 10 waffles per box. Standard 2-waffle serving is now .60c plus syrup and butter.

So what’s the best choice for breakfast if you’re on a budget? It might surprise you that homemade french toast is going to be your best dollar stretcher. Loaf bread at many outlets and at least some store brands (Fred Meyer in my neck of the woods) has bread for .99c for the store brand or day old. An average loaf has over 20 pieces. Crack a few eggs and add a little milk and for less than $2 you can make enough french toast to feed a crew of 5 for a morning, or make it ahead and reheat for fast breakfasts for the kiddos during the week. And if you can get those eggs at .99c, you can even premix your french toast batter and freeze it so you can be assured of those savings when eggs aren’t on sale down the road. And if you really want to be frugal (and healthier) you can make your own syrup from cane sugar instead of the HFCS branded bottles and cut your syrup cost in half.

Want to find the best deal on clothes for the family? Guess what….you aren’t going to find them at Walmart, Ross, or TJ Maxx, stores you would normally associate with bargain deals for clothes.

In light of the current economic condition of the country, discount clothiers are doing better than ever. Walmart (although they don’t just carry clothes) had a 4% growth last quarter. Why? They are beginning to see a new crop of shoppers that they previously hadn’t catered to for one reason or another in the past. But with people hurting in their checkbooks, Wally World has had strong growth while other retailers have floundered. And those economic stimulus rebates? Walmart cashed over $350 million dollars worth so far. The stock price, even in the face of the Dow Jones losing 400 points today, is still hovering close to a 52-week high. You won’t be finding many clothing bargains there.

Ross and TJ Maxx, two other discount clothing store chains are enjoying the same exciting level of gains as people flock to find bargains.

So, if the bargains for clothing aren’t where they normally are, where are they?

They are hiding in the mid to high-end retail stores where inventories are being slashed to clearance at a pretty good clip. What’s that mean for shoppers? Name brands at super cheap prices. Which stores are we talking about here? JC Penney, Kohls, Nordstroms, and Macy’s all trading at half or below half of the 52-week high of their stock price. And as more retailers find themselves heading towards bankruptcy court, one of the best things stores can do is move inventories. Many are parting with clothing at less than what they paid for it.

This week, I stopped by several stores to test my theory. A trip to Kohl’s yielded me a stack of boys sweat pants, normally retailing for $16 a pair for just $1 per pair. A trip to Target, who is also in the mid-stock price slump, landed me $1.98 button down dress shirts for the boys. While one another trip today, Fred Meyer, a Kroger company, had very good clearance items, although I passed on many because their clearance wasn’t a % off this week, it was buy 1 get 1 free which isn’t always the best deal for a clearance sale since the free items is of equal or lesser value. I found I might lose the advantage, so I’ll wait til Sunday when they change the ad back to a percentage off, and I am willing to bet it will be at least 50-60% off the last marked price. Aside from clothing, all of these stores also carry shoes.

So, why do I think NOW is the best time to buy school clothes? Most of the clothes on clearance right now are winter goods that didn’t sell well for lack of consumer spending, so there’s lots to choose from. And the clearance racks have signs from between 60-90% off the last marked price in many locations. So the shirt that was normally $28 and is on clearance for $12 and then is 60% off that is now going to be $4.80, an 83% savings over retail. Watching for promos like 15% off when you use your Macy’s or Kohl’s card will yield you even a better price. However, be sure to pay that card off right away to avoid high interest charges. Store cards have some of the worst interest of any card out there.

Another reason I think now’s the time to buy school clothes is because logically, stores are going to reduce their buying this fall. They were bitten last year as consumer spending slowed, so going into another fall season with too much inventory is going to be something stores are going to avoid at all costs. What’s that mean for clothing prices? I think we’ll see higher clothing prices for lots of reasons including manufacturing capabilities being decreased, raw material cost increases, transportation/freight costs, and then stores trying to keep their heads above water will be limiting in how much discounting they do if they don’t have lots of inventory to begin with.

Lastly, many stores like Fred Meyer are still offering their 10% free money when you buy gift cards if you buy them between now and July. So not only could I have gotten TWO pairs of Nike tennis shoes for $25 today on clearance, if I had loaded a card with $300, the free $30 would have more than covered the price of the shoes. Or I could have bought that $120 Columbia Sportwear jacket for $35 and only would have had to pony up $5 out of pocket for the coat.

So if you have kids, need work clothes for you or your spouse, now’s the time to race to the store and stock up. With three boys, it works out great. I can buy ahead until for the next few seasons for what I would I might have paid for one back to school shopping trip. And of course, anything I buy now for a mere few dollars that doesn’t fit them later, I can feel good about donating because I was out less for a pair of pants than I would have spent on a 20z bottle of soda.

Key takeaway….if you’re a bargain shopper, go shop the non-bargain stores first before you hit the already-crowded discount clothing stores. It’s counterintuitive to think Nordies or Macy’s for the best price you’re going to find, but you’ll be quite surprised just how much clearance inventory is hiding in the mid to high end retail shops.

First off, a quick note to say sorry for having not been online for the past two weeks. Family vacations and finals have taken priority, but I decided with the advent of this week’s Food Day with all the new store inserts out today, I had to get back on here and write. So I am sneaking away from my homework in favor of talking about loss leaders in store ads.

Loss leaders are the quintessential form of grocery chain advertising. They are the easy draw that lures you to the market in hopes that you blow your entire grocery store budget on that one visit. And it works! How many times have you seen people go into the store with their one little coupon clipped from the in-store ad and leave with a cart load of goods that just make you want to roll your eyes? Odds are, you might have even been that person once before you wised up to being a better shopper.

The retailer has tapped into the very inner psyche of the consumer with these loss leaders. Think about how you feel when you see popsicles on sale for .99c for the 18-pack bag, or a 1/2 gallon of icecream for $2.99? (Ok, we know it hasn’t been a half gallon of ice cream in eons - 1.75 qts - we all still call it a half-gallon!!!). What about the case of 24pk bottled water for just $2.99??? That’s a “run - don’t walk” kind of item. We NEED those items, so we tear into the store to get them. But for many, they get lots of other things too, and that’s where the loss leaders even out for retailers.

Clearly, loss leaders are entrancing to the general shopping populus, and they work, otherwise retailers wouldn’t continue to put them out week after week. Then there’s the loss leaders that aren’t really loss leaders at all - they’re merely a sales price and not a screaming deal, but they are presented in such a way that the general consumer can’t tell the difference.

So, how do you push past the clutter in the store ads each week to pull the true loss leaders from the sale items from the items that “must be on sale cause they are in the ad, right?” type of items.

First, watch for the items that have a Limit 1 designation in the ad or on the coupon. That’s a high cost item that the store is trying to still get some kind of margin on, but have it be a big enough draw to get you in the store. A good example of that is Tillamook 2-pound baby loaf cheddar cheese. It currently retails for $10.99-$11.99 a loaf depending on the store. This week’s Safeway ad has it for $4.99, limit one. The catch? You also have to buy $10 of minimum purchase. Now, that can include the cheese, but you still have to buy $5 more of merchandise to get this deal. While this effectively changes the game of being a loss leader ad, a wise shopper would pair this with other loss leader or high-value sale items, get the $10 worth of goods and leave.

On this trip, I would buy the General Mills cereal that’s 4 for $6, use a manufacturer’s coupon for the cereal (and one for the cheese if I had it - they do exist) walk out of there for $10 and have saved $16.

Second, it’s important to have a handle on what regular prices are for these types of items. I know that General Mills cereals tend to run over $4 a box regular, so $1.25 per box as a loss leader isn’t a bad deal at all - and even better with a coupon!

One might ask if chasing loss leaders is worth it in the face of current gas prices. Well, let’s look at this week’s ad in my area.

In addition to the Safeway deal mentioned above, I have two other stores I would chase deals at. All three stores are within a 10 mile loop of my house. My car gets 25 miles to the gallon, maybe a little less in city, and gas here is $4.15 a gallon. So my gas outlay is going to be about $2 for this trip.

My intention is to buy the loss leader items only, and I do use manufacturer’s coupons with these items. Remember, loss leaders might be hiding inside the ad, and not everything on the front page is a loss leader.

Moving on to Thiftway after my above-mentioned Safeway trip, I would get the $1.99 gallon milk. Milk right now in our area is $3.69 for regular, non-organic milk. Gatorade at $5/5 with $1 of 2 coupon I have and a double coupon from the store makes the bottles .25c each instead of $1.99 normally. If I couldn’t find a better deal outside the loss leaders, the Sun Detergent at $2 a piece might be a good deal compared to Tide at $10 a bottle.

Moving on to Albertsons, they have split chicken breasts with ribs, for .96c per pound, limit 4. Compared to $3.99 a pound for regular retail, the savings for buying four packages more than covers the gas to hit all three stores. A few pounds of grapes at .96c per pound vs. the regular price of $2.99-$3.99 a pound would be a decent savings as well.

If I wanted to add one more trip, the three-day sale at Haggen would get me onions for .49c per pound, vine tomatoes for .88c per pound, and 1# bagged carrots for .88c each. I could also pick up another gallon of $1.99 milk there.

Arguably, you could just shop loss leaders each week, coupled with coupons, and not only be able to buy many of the necessities for your family, but save a huge chuck of change.

The great thing about the power of loss leaders is that the sway the average shopper enough to buy more items that aren’t on sale. This keeps the stores offering those sales. But for the frugal shopper, shopping loss leaders only can have a huge impact on your grocery budget. And the time involved? A quick trip to each store for a few items added up would be roughly the same time you’d put into a big trip at one store. The savings however is vastly different.

Take the loss leader challenge. See if you can just shop loss leaders for a week and drop me a comment about how much you saved and what types of items you got. I’d love to hear how this might work for others because it’s always worked well for me.

Happy Shopping!