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What Premium Are You Willing To Pay?

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What Premium Are You Willing To Pay?

Old 06-17-09, 02:09 PM
  #1  
Smallwheels
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What Premium Are You Willing To Pay?

What Premium Are You Willing To Pay?

There is a small grocery store a couple of blocks away from me. It has a meat department and a small bakery. It has vegetables and fruit too. It sells just about everything any grocery store would sell only with fewer brand choices. The second closest grocery is four and a quarter miles away. It is a large national chain store.

As a car free person the nearby store seems like a great convenience. My question is about prices. I have decided that supporting a local store is a good thing, but how much am I willing to support it? It must have a value. At what higher percentage price are you willing to pay to support your local store? My limit is somewhere between 10 and 20 percent.

I have not given up on my local store but I have decided to only use them for items that they price fairly. Any other time I need something quickly they will be considered a convenience store, not as a competitive grocery store.

Pineapples are one of my favorite snacks. At the neighborhood store they charge $1.39 per pound for a six and a half pound pineapple. That equals $9.04. At the larger store they can be had for $3.49-3.94 for the whole pineapple.

Once in a while I like Pringles potato chips. At the neighborhood store they regularly cost $2.25 per can. They were on sale for only $1.56 two weeks ago. I thought that was a good deal until I saw them for $1.50 at the larger chain store.

A one pound bag of brown rice costs $1.85 at the small store and costs only $1.38 at the large store. If I were to pay a 20% premium on that rice to keep it within the limits of my local store subsidy it would only cost $1.66.

The store brand of a can of baked beans from the small store costs 85 cents and the store brand baked beans at the large store costs 67 cents. The subsidized 20% higher price would equal 80 cents.

Lastly, the small store charges $1.99 per pound for sweet potatoes. The large store charges $1.13 each. A big sweet potato can weigh close to two pounds.

The only thing the local grocery store sells that costs the same or slightly less is raw ground beef.

What are you willing to spend to support a local store instead of shopping at a national chain store? Even if these stores were side by side I would support the local store if its prices were just a little bit higher than their competition. As it is in my situation I can't justify spending so much more at it even if it is closer.

If local store versus national chain store wasn't an issue, how much more would you be willing to pay just to shop nearby your home?

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Old 06-17-09, 02:42 PM
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I'd shop at both stores. I'm often willing to pay more for convenience, but sometimes price is more important. Another reason for patronizing both stores is that it lets you monitor how the prices compare.

I have a lot of retail choices in my neighborhood. Today I decided to go to store H instead of store D just because store H has a bike rack and store D doesn't. I guess we consumers are a fickle lot.
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Old 06-17-09, 02:48 PM
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Some of my local stores have lower prices than the national chains. I think because their employees aren't unionized. The local stores are run by Koreans with hispanic employees. I have the feeling that the non-unionized meat cutters aren't as clean or careful with the expiration dates as the unionized ones. The national chains don't carry the Spanish style blood sausage or fresh tamarind so there is also the different product mix.
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Old 06-17-09, 03:11 PM
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Is there any difference in quality? We face some of the same quandries with our grocery stores here, but the (usually) more expensive one we try to support is carrying much higher quality mostly organic food. And on that front, we've discovered that sometimes the more expensive stuff is cheaper in the end, especially when it comes to meats.

It's not an easy question to answer. I do know however, that all else being equal (which it seldom is) I opt for the store that's a longer ride.
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Old 06-17-09, 03:20 PM
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I'd never patronize a store just because it was local. That's not say that I don't patronize local stores; just that the store being "local" isn't, in and of itself, of any value to me.

Better service and/or better products and/or a more accomodating way of doing business are things that local stores often offer. I value those things so will patronize a local store at higher cost to get them.
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Old 06-17-09, 04:13 PM
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Originally Posted by Smallwheels View Post
There is a small grocery store a couple of blocks away from me. The second closest grocery is four and a quarter miles away. It is a large national chain store.

As a car free person the nearby store seems like a great convenience.
4.25 miles IS local and nearby. That's even within walking distance.

In my situation right now, the local store is about 8 km (5 miles) away, and is a very small store with a very limited selection. The nearest large national chain is about 25 km (15 miles) away. Rowan and I don't own a vehicle, but we do have the use of one right now so we've stocked up on food from the national chain for now. We'll see what happens when we have to give the vehicle back to its owner. However, while Rowan was living in this area without the use of a vehicle, he stopped in at the local store for its post office services, and the occasional item ... but cycled to the large national chain once a week for everything else.
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Old 06-17-09, 04:52 PM
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I have lived in a small town with less than 8000 people and I have tried to support my local markets as much as I can. However when I had to commute to work I wasn’t far from a COSTCO and it was a lot less expensive to stock up on non perishables and canned goods because we had a large area to store them in. We even bought a large freezer once and we could shop maybe once a month. I figured I saved maybe $150.00 a month by buying in bulk.

Now that I have moved to a bit larger community the small market is only about a mile away and the super market is a mile and a half. We shop once every two weeks at the larger store and get in-between items at the Fresh and Easy up the street. The prices are less at Fresh and Easy because they don’t have any Cashiers. You ring yourself up and pay at the register. I guess I used to be willing to pay a premium but now I can see no reason to do so.
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Old 06-17-09, 05:21 PM
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There is only one locally owned grocery store in my town that I'm aware of, and it's way out of my way so I can't hardly shop there. I always go to Kroger (Publix when I move into my house), and I could save quite a bit by going to Walmart instead. But I'd have to ride in the most bike-unfriendly part of town, plus I hate Walmart. So I'm willing to pay a little more at Kroger, and I'll be willing to pay more at Publix, as well. It's mostly a matter of convenience. If the local store was closest, that's where I'd shop.
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Old 06-17-09, 05:26 PM
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I've got it easy
2 malls, and 3 grocery chains all equidistant at 1.3/1.4 KM from home, I work at a bakery, which is right next to a local-product heavy market.

Toss in a local fresh produce market down the street, and I guess if you wanted to, you could count the over-priced-organics-only store as well (4.35 for 4L of milk, or 10 something!?)

I just moved here a month ago, and finally got pots and pans, so I'll be able to cook my own food. Now I just need to price out which is cheaper for what!

Maybe so much choice has it's own problems...
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Old 06-17-09, 05:43 PM
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The benefit of shopping and banking at locally owned companies is that it acts like a multiplier of money within a community. Economists have calculated that money spent locally multiplies the use of that money by nine times. Every community not dependent on large scale manufacturing could pull itself out of the economic slump within only one month if everybody only bought products and did their banking with locally owned companies.

Locally means stores and banks that are owned by people who live within the city or state. This means not buying at national chain stores or using Citi, Chase, Bank of America, or any other criminally run institution. Just because there is a store or bank on your corner doesn't mean it is a locally owned institution.

The products I was writing about in the first post were all of the same quality and type. Those expensive sweet potatoes were not organically grown.
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Old 06-17-09, 05:54 PM
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Originally Posted by Smallwheels View Post
The benefit of shopping and banking at locally owned companies is that it acts like a multiplier of money within a community. Economists have calculated that money spent locally multiplies the use of that money by nine times. Every community not dependent on large scale manufacturing could pull itself out of the economic slump within only one month if everybody only bought products and did their banking with locally owned companies.

Locally means stores and banks that are owned by people who live within the city or state. This means not buying at national chain stores or using Citi, Chase, Bank of America, or any other criminally run institution. Just because there is a store or bank on your corner doesn't mean it is a locally owned institution.
In your case both shopping establishments are very "local" in terms of proximity, and shopping at either would benefit the community. Think of it this way. The small store is likely run by the people who own it (often a husband/wife team) and they might hire one other person to fill in now and then. The bigger store might hire 25 or 50 people (depending on how big it is) in the community. In this example, 3 people from the smaller store can turn around and purchase things from other local stores, thus helping the economy. But let's say 30 people were hired at the big store, therefore 30 people can turn around and purchase things from other local stores. That's 10 times as many people able to shop locally.

Chances are at least one of your neighbors works for the larger store. Would that person be happy if that store was deemed unviable and they either had to move to an even larger, more centralized store ... or had to find some other employment?
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Old 06-17-09, 06:03 PM
  #12  
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Throughout college, I walked several blocks extra to make it to the generic grocery store over the overpriced on-campus holdup station. No regrets.
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Old 06-17-09, 06:09 PM
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Originally Posted by uke View Post
Throughout college, I walked several blocks extra to make it to the generic grocery store over the overpriced on-campus holdup station. No regrets.
+1

The two years I went to the University in Edmonton I never ate in the cafeteria ... I always walked to either the restaurants about 2 km away, or the grocery store out that way. I got exercise AND I paid about half the price.
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Old 06-17-09, 06:57 PM
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Originally Posted by Smallwheels View Post
The benefit of shopping and banking at locally owned companies is that it acts like a multiplier of money within a community. Economists have calculated that money spent locally multiplies the use of that money by nine times. Every community not dependent on large scale manufacturing could pull itself out of the economic slump within only one month if everybody only bought products and did their banking with locally owned companies.

Locally means stores and banks that are owned by people who live within the city or state. This means not buying at national chain stores or using Citi, Chase, Bank of America, or any other criminally run institution. Just because there is a store or bank on your corner doesn't mean it is a locally owned institution.

The products I was writing about in the first post were all of the same quality and type. Those expensive sweet potatoes were not organically grown.
I agree and attempt to the same as much as feasible. Currently I am in Iowa rather than NC (imagine that) I have found a locally owned small grocery chain selection is not as good as a larger market but the prices are comparable. Funny you should mention the local multiplier, I was talking to my wife about this very thing the other day, we use a local state employees credit union and a local regional bank for all our banking needs. Our regional bank is one of the few that didn't jump on the band wagon and continued to make safe secure loans to local people, they are in great shape financially and will be around for quite a few more years. IIRC they were started around 1928 or so. We have a locally owned grocery chain where I live in NC that owns it's own meat packing plant and canning facility. When you buy meat or canned goods with his label on it, chances are very good it was grown within a 5 county area of the store. The prices average about 8-10% higher than WM or the other regional chain super market. Small price to pay IMHO for keeping the money close to home.

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Old 06-17-09, 07:07 PM
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Originally Posted by Smallwheels View Post
The benefit of shopping and banking at locally owned companies is that it acts like a multiplier of money within a community. Economists have calculated that money spent locally multiplies the use of that money by nine times. Every community not dependent on large scale manufacturing could pull itself out of the economic slump within only one month if everybody only bought products and did their banking with locally owned companies.

Locally means stores and banks that are owned by people who live within the city or state. This means not buying at national chain stores or using Citi, Chase, Bank of America, or any other criminally run institution. Just because there is a store or bank on your corner doesn't mean it is a locally owned institution.

The products I was writing about in the first post were all of the same quality and type. Those expensive sweet potatoes were not organically grown.
Within a month, eh? It's a shame you and those "economists" aren't in charge of things. Frankly, that's nonsense on stilts. I'm sure you can find an economist or two who will back up what you said, but you'll find many others who'd disagree. Chain stores are staffed by people who live in the community as well; their contributions to the economics of a community don't matter? What would happen to all of them if everyone took your advice? Would the local stores and banks absorb them immediately to meet the increased demand or would some join the ranks of the unemployed?

Local businesses that deliver value to their customers in the form of price or service or efficiency or whatever, are a positive for the local, regional, state, national and global economies. The same can be said for regional, national, and even global chains. Those that don't, aren't.

Wal-Mart and the like, the bugaboo of many, are a huge positive for the poor. Many of us here shop at stores other than Wal-Mart because we can afford to; the single parent of several may not have that choice.
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Old 06-17-09, 07:22 PM
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Originally Posted by KurtAV View Post
Within a month, eh? It's a shame you and those "economists" aren't in charge of things. Frankly, that's nonsense on stilts. I'm sure you can find an economist or two who will back up what you said, but you'll find many others who'd disagree. Chain stores are staffed by people who live in the community as well; their contributions to the economics of a community don't matter? What would happen to all of them if everyone took your advice? Would the local stores and banks absorb them immediately to meet the increased demand or would some join the ranks of the unemployed?

Local businesses that deliver value to their customers in the form of price or service or efficiency or whatever, are a positive for the local, regional, state, national and global economies. The same can be said for regional, national, and even global chains. Those that don't, aren't.

Wal-Mart and the like, the bugaboo of many, are a huge positive for the poor. Many of us here shop at stores other than Wal-Mart because we can afford to; the single parent of several may not have that choice.
Exactly my point above. I wish there were a larger store or business of some sort in my area right now because I would have a chance at getting a job there. As it is, the surrounding towns just have the small "mom & pop" type shops, and they've got all the staff they need ... mom & pop.

And the people who live in this area (all 500 or so of them) could shop every day at those "mom & pop" shops (and many do), but those shops will still only employ mom & pop because 500 people isn't a large enough customer base to hire more people.

The other thing is that the "mom & pop" stores aren't buying locally either. Sure they might stock the occasional item from some local artist or someone who bakes or something, but most of the time the dairy products are coming from a large national factory in a nearby city, the bread is coming from a large national or international factory somewhere, the Coke is coming from the bottling plant in a nearby city, etc. etc.

So when you shop from a small "local" store, you are supporting mom & pop, and there's nothing wrong with that, but you're also supporting the large companies that supply them as well ....... just like if you were to shop from a large store you'd be supporting the larger number of staff they've hired, and the large companies that supply them.

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Old 06-18-09, 11:47 AM
  #17  
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If you want to have a choice, you have to shop at the local store some of the time. You can also let Mom & Pop know which items you don't buy there and they might lower the prices on those items. They do have to compete with the big stores, even on price to some extent, although convenience, service and selection are often areas where small stores are more competetive.

I have the opposite situation. Kroger is only 1/2 mile from my house and smaller stores are all further away. However, I don't buy much at Kroger other than household supplies and canned goods. I think my small local stores give me better value. For example, in Kroger yesterday, they had no packages of chicken smaller than 5 pounds. I wanted one piece of chicken for my dinner, but they were unwilling to provide that. I ended up spending more money buying a lot of chicken that I didn't want or need. At the local store, I could not only have gotten my one piece of chicken, I could have picked out the exact piece that I wanted, and only paid a few cents more per pound.
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Old 06-18-09, 11:48 AM
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If you want cheap food skip the middle man and buy directly from the farmer.
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Old 06-18-09, 12:17 PM
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Originally Posted by Roody View Post
If you want cheap food skip the middle man and buy directly from the farmer.
We buy a lot of food at farmer's markets and often pay more than we would at the grocery. I think it's worth it for the freshness and quality, but it ain't cheap. It's also the only way to get grass-fed beef around here.
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Old 06-18-09, 03:01 PM
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I think it's worth it for the freshness and quality, but it ain't cheap. It's also the only way to get grass-fed beef around here
As far as I'm concerned, it's worth it to pay extra for better food. For me, that usually means food produced by small farms rather than factory-style operations.
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Old 06-18-09, 06:14 PM
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Our Farmers markets are also more expensive than the stores, but the produce is MUCH better, so I will pay that premium. However, when it comes to day to day groceries, I am going to where it is the cheapest, and using coupons. Coupons can help save a ton of money.
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Old 06-18-09, 06:49 PM
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Nearest grocery store to me is like 4 or 5 miles away. Sucks. If I want to get anything quicker than that there is a convenience store a quarter mile away, but they charge quite a bit.
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Old 06-18-09, 06:53 PM
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Originally Posted by Foofy View Post
Nearest grocery store to me is like 4 or 5 miles away. Sucks. If I want to get anything quicker than that there is a convenience store a quarter mile away, but they charge quite a bit.
4 or 5 miles is nothing ... it's a teensy, short ride ... I look at anything about 4 miles or less as walking distance. When you move to a place where the nearest grocery store is at least 15 miles away, that is a little bit more of a challenge.
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Old 06-18-09, 08:06 PM
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"It depends."

I'm only aware that there might be a couple small grocery stores near my route between home and work. But, there's a store about 50 yards away, and that's where I go for almost everything.

I once guesstimated how much I'd save by driving to the big Shoppers store on the other side of the river, and unless I bought a big pile of stuff to make the most use of my time and/or fuel, I wouldn't actually save that much. I'm willing to pay a lil' extra for the convenience of having my entire shopping trip last less than ten minutes.
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Old 06-18-09, 11:57 PM
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For groceries and the like, I have the choice to shop in town and pay a little more or to go to Penticton and save money on everything. The round trip to Penticton is around 50 kilometres, but if I'm going to make the grocery run worthwhile, I've got to drive down (as I'll have too many perishables to take back on the bike.) I'll have to factor in the cost of fuel and maintenance on my car. And I need to consider whether I'd rather save a few dollars or enjoy the extra time I'll save by shopping locally.

I can't realistically ask what my time is worth. If I'm off work and if I'm not involved in another money-making venture, my time is worth nothing from a purely commercial perspective as I'm not giving up paid work or potential income to make the trip. However, since I am involved in a number of extra activities, I need to determine how to use my time most effectively.

Also, before I go out of town for my day-to-day purchases, I need to ask what would happen if everyone were to do that. Eventually, the stores in my community would cease to exist and I'd lose the lcoal convenience I now can enjoy.
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