How to Find a Good Deal
This is a guest post from Craig Ford of Money Help for Christians. If you like what you see here, please consider subscribing to his RSS feed.
When evaluating purchases, some folks are just so enamored with the price. They think a good deal is all about price. I used to think the lower the price the better, so I guess you could call me a recovering price addict. However, I’m coming to realize a good deal can only be found when one factors in both the price and the value of an item.
Consider the following fictional conversation:
Low Price Lover: “I got a great deal on my new bike!”
Person Concerned with Value: “Really? That bike looks like a piece of junk that could break if you sat on it.”
Low Price Lover: “Hey man, don’t dis’ my bike! Most bikes I looked at cost over a hundred dollars and this one was only $35. I got it for 65% less than every other bike I saw.”
Person Concerned with Value: “You just bought $35 worth of junk.”
Admittedly, this conversation over-emphasizes the boasting of the “low price lover.” However, the larger point still stands — any of us can become so enamored by price that we completely neglect to factor in the value or true worth of an item.
What is a “good deal”?
Getting a good deal means getting something that has a higher value for a lower than average price. At a minimum, every buyer should be sure that as the price for an item increases, so does the true value of the product. A purchase where price and value are comparable would be neither a good deal nor a bad deal. So what we’re really interested in is the value/dollar ratio.
When value lags behind price: a bad deal
Instances in which the price of a certain item is high, but the value is not, represent a bad deal. You’re spending more money without getting anything extra in return. If you want some examples of high price/low value items, look no further than the SkyMall Magazine next time you fly. There are some pretty outrageous prices for standard items. The bottom line is that it’s possible to get something for a really low price and still get a bad deal.
When price lags behind value: the good deal
The ultimate “good deal” occurs when you you get a high value item for a low price. In other words, the money that you spend winds up giving you more value per dollar, such that you’re maximizing that value/dollar ratio.
What are the best ways to get a good deal?
- Shop second hand stores. Some folks love name brands. When you shop second hand you can still get the value of a name brand without the associated price increase.
- Shop garage sales. Garage sales are filled with things that no longer appeal to their owners. In many cases, however, the items are still as valuable as ever. As a result, it’s possible to find like-new products at garage sales.
- Shop off season. Who wants to buy shorts in September? You do! When you buy off-season, you can typically buy items for anywhere between 50-85% off. Now that is a great deal.
- Inform the sales associate. When I bought my last computer, I started by simply telling the the sales rep that I was looking for a computer. After he showed me a few computers, I specified that I was looking for a good deal, and he then showed a number of items that had been deeply discounted for various reasons. Remember, as long as it fits your needs, and the value exceeds the price, you’re getting a good deal.
- Anticipate your needs. The more time you have available to purchase your item, the more likely you are to find a good deal. For example, if you know in advance that you need new running shoes, you have time to shop around and a great deal. If, however, you head out the night before a big race, you’ll be forced to buy whatever is available regardless of price.
- Look online. You can find some great prices online. If you’re not comfortable shopping online, then at least make some price comparisons and then ask a local store for a price match.
- Be creative. You can get a great deal if you find a way to share a product or even if you find a different item that will fill the same needs. When making a purchase, you might also consider asking if the store will throw in something extra.
- Inform friends and associates. If you are hunting for a particular item, be sure to let those around you know. It’s amazing the number of times someone has an item they are willing to sell (and even give away) for practically nothing. Take advantage of your networking groups.
- Check out non-traditional shopping outlets. Craigslist and eBay are both great places to find a good deal . Find a flea market around.
- Use cash. When purchasing items — especially from individuals — nothing makes them more anxious to make the sale than a flash of cash. They know if they make the sale there will be no hassles or problems with getting paid, so don’t be afraid to make an offer accompanied by a fistful of cash.
Any more ideas?
Do you have any additional tips/strategies for getting get a good deal?
Filed under: Frugality
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November 13th, 2009 at 8:01 am
Estate sales usually offer better quality goods than yard sales. Around here, anyway, most people put out their most worn-out junk in yard sales, and yard sales are generally not allowed in the better neighborhoods.
November 13th, 2009 at 8:37 am
The secondary market is usually the best for deals. There are also grocery auctions which is a great place to stock up on grocery items.
November 13th, 2009 at 9:43 am
Ever since college, I learned to build my own computers, it’s really easy to do, and you save somewhere between 50-60% of what you would buying an equivalent pre-built one.
November 13th, 2009 at 10:17 am
Be sure that you really want the item, or it’s not a good deal at any price.
John DeFlumeri Jr
November 13th, 2009 at 10:19 am
This trick only works when you have discretionary income – But let’s say you have $500, and you want a kayak. Well, set your money aside (high yield money market anyone?). Then start trolling – all the locals Craig mentioned – 101% guaranteed you will meet someone who is trying to get out of debt, getting a divorce, or some other duress. Tadah!! $1,000 kayak for $500. Obviously I am not talking strong arming people or anything like that, but the secondary market for most thigns is about 50 to 60% of New In Box price. So, they have money to get out of debt, pay an attorney, post bond, etc.. and you are in your PAID FOR kayak.
November 13th, 2009 at 10:58 am
Avoid designer brands and you’ll save a ton. Take designer sunglasses as an example. They are made in China, from the exact same materials as any other sunglasses. But LV, and Gucci, and all the other designers have spent millions of advertising dollars convincing gullible people that they are not worthy, or cool, or hip unless they sport the designer logos.
What separates $1500 designer sunglasses from the $5 ones you can buy at a vendor?
The little gold “LV” on the side.
That’s it.
November 13th, 2009 at 11:18 am
It depends on the person. An item could be very expensive but totally worth it to someone if they saved up and are really looking forward to the item.
November 13th, 2009 at 12:43 pm
Check for “scratch and dent” items at stores too. I know someone who got a great deal on a fridge because it had a huge scratch down one side. That side just happens to be the side that is bumped up against the wall, so no one will ever see it.
November 13th, 2009 at 6:32 pm
Funny example, I had this same conversation the other day – almost verbatim! I bought a very used bike on Craigslist for $15. My only criteria was that it was rideable. I just need it to get from A to B, not win any beauty contests.
I showed my roommate (who is an avid bicyclist, with hundreds of dollars in equipment) and he laughed at me. He pointed out that it was ugly (think 80s pink and teal) and the seat is stained. I said I don’t plan on eating off the seat, and asked him to check the wheels for me to see what shape they were in. They’re fine.
My long-winded way of saying: its important to identify only what you need. My bike wouldn’t work for my roommate, because he rides 50+ miles a week and races. But, it works for me to commute a few miles a couple times a week. Conversely, I spent much more on my laptop than he did because I use it for programming enterprise software and he uses it for checking fail blog. Different needs.
November 14th, 2009 at 8:54 pm
I search for stuff that I want, and then look if there are any deals available on them. If there aren’t then I simply buy the thing without any fall in deal. I think it makes no sense to get something only because it was on a deal.
November 15th, 2009 at 11:26 am
If you are a serious runner, you should not buy your shoes the night before the big race anyways. You want to buy them well in advance and have a period of time to break them in before racing in them.
Now I just need to find a place to get a good deal on all those spendy running shoes…