Friday, 28 June 2013

Express Convenience Stores...A rip off by any other name

As I posted about previously, a few months ago I moved out of home.  One of the things I have to do now therefore, which I never had to do is shop for myself.  I actually find this a lot less unpleasant than I thought it would be and I'm rather organised about it - I make a list, stick to it and pick up goodies which are on special.

I generally do my shopping on a Monday night because it's the night I'm least likely to have any social activities on however as I was down with the flu last week I couldn't do my shopping.  I was then rather busy at work and so had even less time so I thought I would go to one of the convenience / express stores in the city near the office to pick up some essentials (such as bread, milk, cheese etc) to try and save some time.

I could not believe what a rip off convenience stores were

You always hear about how milk bars and corner stores are more expensive but that makes sense - they are unable to buy in bulk and thus they have a higher cost of product and you pay for the higher cost because it is convenient.

I made the assumption that it would not be as bad if I went to a 'brand name' store.  The store I went to was an IGA Express store.  The whole purpose of the IGA stores is that they have bulk buying.  I therefore expected to pay around the same price as if I went to a regular IGA or Coles wrong I was...

The prices in the convenience store were 2x - 3x what you would pay in normal stores
Instead of bread being $1 a loaf it was $3 for the home brand.  A small block of cheese was $7 instead of the $3 I usually pay for the same item.  This was true for almost all of the items that I was looking for.  I ended up buying just what I needed for that day and then doing a proper shop later in the week at a major store.

You are paying for the 'convenience'...

This is the ultimate form of price discrimination.  I have written about charging people different prices based on their ability to pay before.  Convenience stores take this
one step further - they target those who are time poor and thus are willing to pay more to save the time of going to an actual shopping centre or major shop.

However, given how prevalent and widespread major supermarkets are now, and the fact that the quality is exactly the same in the major supermarkets, I do not know why anyone would shop at these places.  It is a mistake I imagine that most people make only once - I can guarantee you that I will not be going again to those types of stores.

It also makes me wonder how sustainable that shop model are relying on the shopper who has to use you and then rip them off.  You end up with a dissatisfied consumer and a very short term profit.

I would never shop at one again

As I mentioned above...this is not a mistake I am likely to make again.  You can do this check for yourself - take a standardised product like a loaf of bread or a particular brand of milk or cheese...something that you buy often and know the price of and compare the price of this versus your major shopping centre.

Major supermarkets are also generally open very late (if not 24 hours).  The 'convenience' of these stores is extremely limited and I would be surprised if the model survives for too many more years.

Do you ever shop at convenience stores?  Is there any reason you would?

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