Big Box Stores Vs. Small Retailers

By Angela Daidone | February 09, 2012 AAA
Big Box Stores Vs. Small Retailers

Big box stores, like BJ's, Costco and Sam's Club, lure customers with the promise of saving by buying in bulk. But do they really pay off for the average consumer, or can you get better deals by shopping at mid-sized and smaller retail stores or local markets? Likewise, is shopping big worth it for you?



SEE: 5 Avoidable Shopping Mistakes

Here are five factors to consider, and the pros and cons of shopping big.

Price
Price is usually the biggest factor when choosing where to shop. But today with everyone feeling the economic pinch, retailers are vying for your business and will do anything to get you through the door.

Pro:
Big-box stores often offer huge discounts on big-ticket items compared to specialty stores or smaller retailers. So yes, you can save hundreds of dollars on electronics, appliances and other large merchandise.

Con:
Once they have you in the store, however, they're counting on you to purchase other items, which aren't discounted and that you don't even need. Not everything in big-box stores carries a deep discount.

Best Bet:
If you're shopping for a particular item, buy what you went there for and avoid the temptation of "looking around." Also, check out weekly specials in your local market or discount store. You may get a better deal on some items and they frequently accept coupons for additional savings.

Quantity
Big-box stores typically carry items in the extra-extra-large size, which is fine for large families who go through lots of food and other items, like paper products and toiletries. But is it worth it for the average couple or small family?

Pro:
Customers can find real bargains in purchasing bulk non-perishable items, like paper goods, or food items such as cases of soda, canned goods or 20-pound bags of frozen chicken wings.

Con:
The problem is finding space to store towers of bathroom tissue and that case of dish detergent, or squeezing items into a tiny freezer.

Best Bet:
Be practical. Purchase what you can easily store and avoid buying large volumes of perishables, which may go bad before you get a chance to use them. (For more, check out 6 Common Pitfalls Of Brick-And-Mortar Shopping.)

Fees
Big-box stores or warehouse clubs charge yearly membership fees that cost on average between $50 and $100 to join, with some offering executive memberships for a bit more. That fee will get you in the door. Purchases are, of course, extra.

Pro:
If you have a large family and do frequent shopping, the money you save over the course of a year (depending on what you purchase, of course) can easily cover the cost of the membership fee.

Con:
If you don't frequent the store, your fee may not be recouped, so you're better off shopping at a smaller retailer or local market and save the initial fee.

Best Bet:
Look at your shopping habits and give serious thought to how much use you'll make of the big-box store before you dish over the $50, or more, for the privilege of walking through their door.

The Shopping Experience
Big-box stores usually attract big crowds, which mean long lines and mobbed parking lots.

Pro:
Sometimes fighting the crowds is worth it just to get a good bargain. If it weren't, retailers wouldn't count on Black Friday sales to help them through the fourth quarter.

Con:
Waiting on long lines, circling the parking lot for a space and struggling to get down the aisles can be stressful, not to mention time consuming. When you figure in the hours spent on your quest for a bargain, well, it doesn't seem like such a bargain anymore.

Best Bet:
Try to shop during off-times when there are likely to be smaller crowds. If that's not possible, think long-term: buy enough to last a few weeks to help cut down on the number of visits.

Customer Service
Good service is the key to success for any business, big or small. When it comes to customer interaction, however, big-box stores are very different from your neighborhood shop.

Pro:
Customers who typically shop at big-box stores aren't so much interested in making friends with the sales associates as they are in making their purchases. If you're confident in being on your own, big-box stores is the place for you.

Con:
Big-box store employees are typically stocking shelves and helping customers grab items from the top of the rafters. Some shoppers, however, need more intimate interaction with the sales help, which smaller retailers or specialty shops can offer. You won't find that personal attention in the big-box stores.

Best Bet:
Ask yourself which you'd prefer – anonymity or up-close and personal. Knowing before you shop will eliminate frustration.

The Bottom Line
Big-box stores definitely have their place in consumerism, as do small retailers and local shops. It's up to shoppers, though, to choose their shopping preference as well as take a harder look at where the real bargains are. (To help you save more, check out our tutorial on Budgeting Basics.)

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