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February 20, 2005

Price Books and Lunches

As if Wal-Mart weren't pain enough, my wonderful city got its first Sam's Wholesale Club a mere three weeks ago.

Rather hesitantly, I ponied up the $35 fee for an annual membership. I hadn't been inside a Sam's Club in years — my childhood town has had one for a long time, but I try to stay away from that city as much as possible, and I'd sooner take a horsepoop-crusted cowboy boot to the face than shop there.

So I have had a long, long absence from Sam's Club shopping. This meant that as of the time of our membership sign-up, I really had no actual proof as to whether or not the prices in Sam's were that much better than, say, Wal-Mart. Friends and coworkers tell you things, of course, but their opinions are a bit tainted:   Most of them seem to get a freakish high when their Tahoes and minivans are piled full of "stuff," and Sam's is a major high-volume outlet for "stuff." Also, by extension, most friends and coworkers are broke. Is their judgement of a "good deal" really worth banking on?

Now obviously, if you run a business and you like to buy products by the gross, then Sam's might be your place. But I never much understood who would possibly need 10-packs of Oral-B toothbrushes. Or 5-bottle packs of Centrum multivitamins. Or gallon jugs of Wish Bone Italian salad dressing. Well, restaurants might want that last item, I guess, but I'm not a restaurant. A 24-ounce bottle of Italian dressing will do me just fine for quite a while.

Anyway, now that I've shopped Sam's Club twice, I figured it was time to talk about the issue of price books. And . . . well, lunches.

What's a price book? Well, I've always understood it to be a small notebook that frugal moms stashed in their purses because they just didn't have enough crap loaded in there already. Whenever Frugal Mom went shopping, she'd whip out the notebook and jot down the names, prices, weights, and/or quantities of her most commonly-purchased items.

This is yet another example of the power of information. Keeping track of prices like this with a price book is really the only way to know which store has the best prices on which items. It tells you who is selling what for how much. Thus it can greatly assist you in determining which sales are worth making a special trip; i.e., you have a written record of regular prices to which you can compare the sale prices. Sure, lots of prices look good in those colorful circulars, but how do you know they're good? You don't. Or at least, not without a price book. Or a photographic memory.

I will clearly state right here that I have never kept a price book, nor have I much considered doing so. I've always pretty much figured that it wouldn't be worth the time and effort. Until now.

And why now? Because, as you can see from the chart to the right, a big percentage of my monthly expenses are attributable to groceries and household items. In fact, over 17 percent of my take-home pay goes there, making it second only to my house payment. And that doesn't include the money I spend on lunches during the week — it gets categorized under "Dining" or "Cash." So you could pretty much add another three percent to the "Grocery" column to account for this.

And there are simply too many commonly-purchased goods at Sam's Club, Wal-Mart, and every other retailer that, if the price were right, I could use to my advantage. And whatever Sam's doesn't stock, the blue vests at Wal-Mart do.

Take lunches, for instance. Eating out at lunchtime costs me, on average, $5 to $8 per day. Figure at least 20 working days in any given month, and that puts the monthly lunchtime price tag at $100 to $160. This, in my world, is significant coinage.

Time for change? So the last few weeks, I wanted experiment a bit. I began taking my own lunches to work. I've done this before, but it never lasts. Now, though, thanks to my Price Book and to a little note-taking effort at Sam's and Wal-Mart the last few days, I know how much I saved, and how much I can save from this point. How penny-conscious can I be? Well, check out a page from my price book spreadsheet (you knew there had to be a spreadsheet, right?):

Price Book Spreadsheet Sample Page (.gif)

So, if I'm willing do a little research, shop diligently, and brown-bag my lunches, then my grocery and dining expenses will drop significantly. Two meat-and-cheese sandwiches, a self-bagged pouch of Cheez-Its (you can get a 3-pound box at Sam's, and use that to fill 22 snack-size Ziploc pouches), a 10-ounce bottle of orange juice, and two sugar cookies, and I'm looking at a very reasonable total of around $1.80 ... Ziploc bags and all. Monthly dollar damage via this route? Around $36.

Read that again:   $100 per month, versus $36 per month.

Not too shabby, huh? Looks like I just axed my lunch money expenses by at least 64 percent.

Those savings, by the way, will pay for my Sam's Club membership in eleven working days.

But let's say I don't want sandwiches every day. (And who would?) I could still put Sam's to good use. I'd just buy a box of, say, 30 State Fair Ballpark corndogs (individually wrapped), and pay $8.17. That'd be $.28 per corndog, or closer to $.30 with tax. I'd eat three of those for lunch, plus my bottle of orange juice, and still be out only $1.37. Healthiest lunch in the world? No, not really. But neither is Happy Garden Chinese Restaurant or Little Caesar's Pizza. And this doesn't hemorrhage my bank account.

There was a time — a few weeks ago — when I thought none of this mattered that much. Folks, I was wrong. It matters. It matters at least $64 per month. Or $768 per year.

That's some pretty nice "found money." I mean, I could do stuff with $768 per year.

Thanks to my willingness to look a bit silly today, writing down price after price in Sam's and Wal-Mart, I now know that yes, Sam's can give you a significantly better deal on lots of popular items. Charmin toilet paper, Bounty paper towels, Pampers diapers, Wolf Brand chili, Ragu spaghetti sauce. The list of stuff I would buy anyway, but can now "buy even cheaper," is hefty. Now that my price book spreadsheet is nicely populated with my commonly-consumed items, I can see where the gooooood sales are.

Wow. Spending five bucks for lunch, day in and day out?

All of a sudden, the thought of it feels really . . .

. . . dirty.

Michael | February 20, 2005

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