“Seeing is not Believing” part 18

Christmas Sales Dangers

For the last five months, Slightly Creaky’s blog has been running a series called “Seeing is Not Believing,” explaining the ways that advertisers, manufacturers, and stores manipulate your senses in an attempt to get far more than they deserve. This week we wrap up that series and prepare for a new one.

As we close in on Christmas, all around us are advertisements for sales. Every year, November is the month or getting ready for Christmas sales, December is when we get zonked with “Buy, Buy, Buy,” and January sales are when stores get rid of the leftovers. Most of these sales are based on percentages – 10% off, 20%, 30%… even as much as 80% off. We must ask – 50% off what?

You have to wonder, if stores can take so much off their prices, and not only stay in business but expand and give the bosses and stockholders huge bonuses, then just how much of a mark-up is there? In “Seeing is not Believing” we have spoken about pre-sale markups, the concept of list price, and the manipulation of sales terms to befuddle and mystify the public. During the last four weeks, we have been carefully studying ads and sales prices and have noticed one simple trend: no matter how great the percentage discount, the prices have hardly changed.

Remember what we have previously discussed: stores can set whatever price they want on an item. We have no way of knowing how much they cost to manufacture, ship, store, and how much these businesses mark up the products. We have seen the same item, same size sell for a huge range of prices. Here in the northeast, the same can of Campbell’s 10.5 ounce gravy was selling in ShopRite for 3/$1.00, it was on sale the same week at Price Chopper for $1.00 a can, and elsewhere we have found it for as high as $2.49 a can.

If a store sets the “list price” of an item, say a lady’s blouse that cost them $10 wholesale, at $80, then that is its value. They only need to sell it at that price once. That is the value they put on it, and that value is not set in your mind. They can then sell it for any amount and call it a sale. Yet each time you see it, it’s listed as an $80 value. They can take 10% off at $72, or 30% off at $56 and still make a huge profit.

Then comes Christmas and their huge “More than 50% off” sale. This blouse, selling now for $39.95 is still bringing them a huge profit. In three months the leftovers will be at $19.95 at Marshall’s and they’ll do just fine. Even when they reduce it 30%, they are making money.

There is no law that prevents any store from removing a price tag and substituting one at a different amount. It is a general rule that stores that are holding “out-of-business” sales raise their previous prices 20 to 40% prior to putting “Everything on Sale at 30% off.” Thus the items may be selling for even more than they originally were.

At the holidays, many stores use the same ploy: raising their price tags, then discounting the items based on the higher price. Any percentage-off sale is meaningless unless you can compare the new price to what that item typically sells for. ‘Tis the season for giving; yet businesses believe this is the season for taking. Be careful, be knowledgeable, and do not believe all that you see.

Happy Holidays everyone.

Consumer Safety & Awareness

In November, I offered my services to teach a class on “Consumer Safety and Awareness” at a college near where I live. If all goes well, this offering, at their Center for Community and Educational Services, will be available to those in New York’s Hudson Valley area. This is not a college level course, rather an “adult education” presentation open to everyone.

As is my habit, when I get involved in a project I dive in, doing research, writing out ideas. Totally unanticipated, I already have far more information than I can possibly use for that 5-session offering. And my research has shown me that there’s a lot more information out there.

Therefore, as a service to the public and as an extension for those who take the class, starting next week the Slightly Creaky blog will be offering a new series “Consumer Safety & Awareness.” It is my hope to extend this to at least 50 weekly articles covering scams, fraud, household and automotive safety, Internet, mail and telephone fraud, and much more.

If you have been taken by anyone, by a scammer, a store, or a service company, we’d like to hear about it. Feel free to post your comments on this blog, on the Slightly Creaky message board, or simply write to us at info@slightlycreaky.com.