Could Generics Save You 30% in Your Grocery Budget?
Hello Fellow Savers!
After I graduated from high school I worked part-time for a health food store called Arizona Health Foods. AZHF had their own line of supplements consisting of multivitamins, all the vitamins and minerals, CoQ10, digestive enzymes, glucosamine, etc. Basically they had their own line for every popular supplement at the time.
A few weeks before we actually launched the AZHF brand and put it on the shelves, the manager spoke to all of us and told us how we’d get a bonus (collectively as a store) depending on how much of the AZHF brand was sold each month. I was intrigued by more money ($6.15/hour wasn’t exactly doing it for me) but completely dismayed when the product arrived. The bottles were solid white, with a white label, black lettering, and the AZHF logo. They looked pretty generic. You would hold that bottle up next to something from Nature’s Health or Nature’s Way and it wouldn’t look nearly as appealing.
On top of that, the little guy on my right shoulder started whispering a few questions in my ear — would I be pushing an inferior product just for the money? I decided to ask my manager about that. I didn’t want to promote the product if it wasn’t as good as the alternatives (cheaper, yes — but if it was as good as it looked then I was concerned). She took me to the back and showed me a packing slip from the shipment of the AZHF multivitamins. On that packing slip there was also a shipment of my favorite multivitamins (they were from Oregon Health at the time).
It turns out Oregon Health was manufacturing their brand, and our brand. Same exact pills. Different bottle. Ours were a few dollars cheaper.
This happens quite a bit with generics. The same company that’s selling the spaghetti sauce for $2.49 is also selling the store brand next to it for $2.09.
I see it as a win-win for grocers and consumers. The grocers don’t need to fund large advertising budgets to raise awareness about their new spaghetti sauce, they simply use the very-valuable shelf space they already have to let consumers know they have an alternative that is cheaper.
In a recent Neilsen survey, consumers like you and I are catching on. 62% said, “store brands were just as good as name brands.”
It may not happen every time that a national brand is also making the private label brand as well, however, a simple comparison of ingredients will put your mind at ease. You’ll be surprised how many times they are the exact same.
Today’s Budget gives a great tidbit on the types of foods that make a lot of sense when going generic: “Staples such as rice, flour, sugar, salt, milk, applesauce, apple juice, frozen vegetables, frozen juices, vinegar and pull-ups for the toddler all make for great store brand or generic purchases.”
I’m certainly not saying if you have a favorite food, swap it out for the generic straight away. But know that there are plenty of opportunities to buy generic where the taste and quality are both on par, but the cost is significantly less. Remember, AZHF had their products made by the exact same companies with whom they were competing!
Most consumers report that when they make a concerted effort to move toward private-label brands, their savings are significant — sometimes upwards of 30%. When you consider that your grocery bill is one of those few things that you can actually influence quickly, it makes sense to look there for bottom line savings.
Stay tuned for next week’s tip! It should save you a couple hundred dollars per year if done correctly.