Thursday, December 10, 2009

A pricing thought

I have a theory that in supermarkets, unless you know the approximate price of every item, you are bound to be ripped.

Karthik help name this phenomenon if there isn't one. For a long time in life, I was immune to grocery shopping - there was always someone to do that work at home. But since I started living life in a different city etc., that job has fallen on me (or us) with the result that as I walk along supermarket aisles, I keep getting ideas and theories.

One such theory is that supermarkets often jack up the price of some random item - that is not high on the consumption list like grains or pulses - and put a high margin on them. Case in point being, say, groundnuts or sago or something along those lines. And from then on there are two possibilities.

One, being that the customer who comes to the supermarket for a fortnight or a months shopping knows the price. In which case he decides to pick it up anyway because he will have to scout the same at another store. And unless you know the price correctly, there is no saying what is the right price. Maybe it went up overnight? So, the chances that the customer will pick it up anyway is high.

Second, being a trivial choice, is that the customer does not know the price or (which is equally possible) does not see the price. In which case, the item gets picked up anyway.

My question - is such a thing plausible? Predictably Irrational anyone?


Connected..Yet Disconnected said...

It is certainly possible. When Subhiksha was there, I used to buy in Subhiksha and was sure that all the prices were almost the cheapest of all the supermarkets. Now in foodworld or Reliance Fresh, there are many varieties of grains and though all look as if they are of same quality, there will lot of difference in their prices. I think if there is an easy way to know the market prices of all the groceries with the shop where they are available on a website for each city, we can just carry a print out and then get them from those shops.

Rangachari Anand said...

There is a case for convenience too. Do you have so much free time that you can go to five stores to find the lowest price for items on your shopping list?