Does Buying in Bulk Actually Save You Money?

Tuesday, May 27, 2014

If you’ve ever tried to save money, you’ve probably contemplated buying in bulk. But, does it actually work? Will buying in bulk actually save you money?

If you’re not familiar, buying in bulk is a practice where you buy large amounts of grocery items from suppliers and warehouses (like Campbells Wholesale, Costco, and Springer Foods) instead of smaller amounts at your local supermarket. It’s a popular suggestion for saving money on your groceries because, in addition to sidestepping supermarket mark-ups, you can save money and time by shopping less often.

Does it actually save you money? Yes – but only if you do it correctly. As you might expect, there’s a little bit more to it than simply rolling up at warehouse and stocking up for the next six months. Firstly, you need to know exactly what to buy. For some products, it’s true that it’s cheaper to buy them in bulk than at the supermarket. For others, it’s actually smarter to get them at your local supermarket.

So, which is which? What should you be buying in bulk and what should you be buying in a supermarket? The conventional wisdom is that buying in bulk should be reserved for non-perishable items (toiletries, canned foods, pasta) and that perishables (dairy, fruit and vegetables) should be purchased at a supermarket or somewhere similar in smaller quantities.

But, you can go a little deeper than that. For example, a recent investigation by Forbes Magazine found that certain perishable items are generally more consistently discounted at supermarkets than at bulk stores. If you’re looking to buy soft drinks, potato chips or toilet paper, you’d do well to pay attention to your supermarket’s sales. Per item, they tend to be cheaper.

(Toilet paper is of particular note, in this instance. It’s often cited as one of the main items you should buy in bulk – but Forbes found that, because it’s such a universally used item, it’s frequently  heavily discounted by supermarkets.)

There are also certain exceptions to the perishable/non-perishable rule. You’ve probably already figured out that a semi-decent freezer means you can bulk buy and stock up on meat – but, as a recent article by MSN Money’s Leah Culler explains it also means that you can save a lot of money on certain fruits and vegetables by buying in bulk.

Snow peas, broccoli, cauliflower, sweet corn, green beans, peaches, blueberries, strawberries and raspberries can all be frozen quite easily, for example. Alternatively, Culler suggests you can save money on fruit and vegetables by bulk buying produce with a long shelf life – items like potatoes, onions, garlic and apples.

(Another tip from Forbes – while produce is definitely something you should try to buy in bulk where possible, supermarkets do tend to regularly have discounts on key items that outstrip bulk buying outlets. It’s best to keep an eye on sales.)

There are also some surprising items that you should avoid buying in bulk because of their shelf life. Nuts, for example. The high oil content in nuts means they’ll go rancid within one to four months. For obvious reasons, cooking oil has a similarly limited shelf life. Matt Sailor of How Stuff Works also suggests avoiding bleach, spices and brown rice for similar reasons.

(His final recommendation is that you should avoid buying candy or chocolate in bulk – but only because you’ll simply end up eating more of it. After extensive research and great personal expense, I can confirm his hypothesis.)

If it all sounds a bit complicated or hard to remember, you can generally follow a few pieces of advice to determine if you’re better off buying in bulk or buying at a supermarket:

Firstly, look at shelf life. Is this an item that you can feasibly buy in bulk and make use of? A website like Shelf Life Advice can help you out, in this regard. You should also consider your own personal usage. How much bread do you actually use? You may only need a half-loaf.

Secondly, you should shop around. You should compare prices between supermarkets and bulk buying options. A website like GroceryCop will help you compare prices between Australia’s two major supermarkets Coles and Woolworths – but that should only be a starting point. You should look at local retailers, catalogues and different bulk buying outlets as well.

Finally, look at Price Per Unit for grocery items – not just bulk or package price. A bulk item might look like a bargain but you could actually be paying more per unit than you are at your local supermarket. The aforementioned toilet paper example is a good demonstration of this fact.

If you’re mindful of those factors, you should develop a fairly decent compass for what and what not to buy when you’re buying in bulk. But, of course, knowing what and what not to buy is only the start of the battle. To save money, you also have to make sure you know how to avoid wasting your bulky groceries. More on that to come soon.