# Friday, March 09, 2007

I read an interesting article in the Daily Mail about some of the tricks supermarkets use to make customer think they are getting a bargain. It has already been publicised that when Tesco recently ran a promotion on half price fruit and vegetables they had in fact raised their prices before reducing them. In fact they nearly doubled some prices before cutting them back to half price and advertising a huge 50 per cent discount prompting an investigation by trading standards. I wonder how many customers monitor prices so closely that they would have noticed this sneaky tactic. It’s very easy to pick up a product with a half price tag and just assume you are getting a great deal.
Tesco price link

Other tricks that supermarkets use to try and confuse the customer are things like reducing the pack size on items when they are running “buy one get one free” promotions. In other words you may get two packs of strawberries each of 225g but the normal pack size when the items are not on promotion could be 500g.

Many supermarkets also offer special offers or low prices on a few staple goods such as bread and milk. By making prices of everyday items cheaper customers may naturally assume that the supermarket will also have cheap prices on other groceries. Often the reality is that these cheap prices on staple goods are subsidized elsewhere by putting up the prices of other goods.

“Buy one get one free” deals may also seem like a really good deal and perhaps they are for the customer. However, the supplier often loses out here. Most of the large supermarkets have agreements with their suppliers that they have to cover the costs of these special deals rather than the supermarket themselves. Unfortunately this means that smaller suppliers are often squeezed out the market as they cannot afford the low profit margins often associated with getting their products into the supermarket.

posted on Friday, March 09, 2007 9:47:55 AM (GMT Standard Time, UTC+00:00)  #    Comments [0] Trackback
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