When Buying in Bulk Is Actually a Waste of Money

2022-10-11 02:47:26 By : Mr. Hui Jue

As inflation continues to skyrocket, even folks who once floated through grocery and department stores without paying much attention to things like “unit costs” and “price per pound” have started sweating their budgets and those of us who have always worked coupons with the precision and creativity of a mafia accountant are finding that our usual hacks aren’t yielding the same margins they once did. As everyone in the country seeks a little relief from rising prices, bulk-buying is coming onto more and more people’s radar.

Buying stuff in bulk is a simple concept: You purchase a large amount of something—say, toilet paper—and you get a break on the price due to volume. This is such an obviously good idea that warehouse clubs selling groceries and other items in bulk are a huge business with more than half a trillion dollars in annual sales . That’s a lot of pallets of toilet paper.

The simplicity of the concept makes it seem like you could simply purchase everything you need in bulk and enjoy maximized savings, but the truth is a little more complicated for two main reasons: There are hidden costs in bulk-buying and there are negative side effects. If you don’t watch out for both, you could wind up wiping out all the savings you enjoy on the front end.

First and foremost: Bulk-buying almost always saves you money upfront. For example, a 2.6-pound box of oatmeal costs you $4.49 at the grocery store, but you can get a 10-pound box at Costco for $7.99 , saving you nearly a dollar per unit cost. That’s a lot of money you just saved. While the margin of savings varies depending on the category—buying applesauce in bulk, for example, will save you just a few cents per unit—if you apply a bulk-buying strategy broadly, you will absolutely rack up savings.

Coffee time Has a 20-bar high-pressure system to allow for faster heating and better extraction when it comes to your espresso, which means a richer and creamier flavor. It also has quick brewing for fast results, automatically stops the flow when needed, and has a professional milk frothing system.

But then come the hidden costs. If you’re not careful, these costs can erode or even eliminate your bulk savings advantage:

Bulk-buying without careful planning can also lead to some negative side effects that can indirectly impact the savings aspect:

Bulk-buying requires more than a calculation of the unit cost. You need a storage plan and a consumption plan to get the most out of it.

Some things will always make sense to buy in bulk as long as you plan for it, like cleaning supplies, non-perishable food like rice or canned food (though not canned vegetables—see below), shelf-stable beverages, and toiletries. But some things don’t work so well. Here’s what not to buy in bulk:

Bulk-buying is a great strategy, especially if you have a large family to feed and care for. But it’s not as simple as it seems. Keep the hidden costs and knock-on effects in mind when you plan your bulk-buying strategy and you’ll have a much better experience. And also never run out of Doritos ever again.