While walking through a store today I noticed they had these chicken broth for sale. It caught my attention because it was the exact one that I used for my one dollar budget site. In this case, each can was priced at $1.39. Probably a so-so price if you are just wandering to buy things and just happen to want this item.
But in comparison, this exact same item was on sale for 77 cents at a larger supermarket back when I saw it on sale. It was almost half the price. Suddenly that $1.39 just seems like highway robbery right?
That’s one of the disadvantages a smaller business has over the bigger ones as they often don’t have the buying power to compete with large companies. I found this to be truer with packaged goods as the small grocery stores often purchase these items from the regular supermarkets that you and I do where they simple resell it. This is as opposed to the large supermarkets buying the products from the vendors to resell.
I still remember as a kid I understood this concept from my local corner store. They were selling these donuts in a package where I immediately knew I was from one of the supermarkets as I recognized the package and all. A dozen of these donuts were like three dollars. I then saw a person saying to the clerk that he wanted to purchase one and the store was reselling a single donut for one dollar each. I couldn’t help but blurt out to the clerk that those donuts were from the supermarket. The customer didn’t hear me but the expression on the clerk’s face was like “Quiet kid, he doesn’t know that.”
After that experience I always assumed that small stores often sold things with a high markup as people are purchasing more out of convenience and a lack of knowledge as to where you can get things from the source for a lot less. Understandable from a business perspective of course as small businesses don’t exactly have the buying power to directly establish its own inventory from the source. Good to know for you as the consumer if you want to save money.