Canadian Personal Finance Blog

Archive for January 5th, 2009

Wal-Mart and Mystery Discounts

Over Christmas I did my normal minimal Christmas shopping, and thanks to this I have become quite puzzled by the pricing practices at Wal-Mart and the Bay.

At Wal-Mart I have run into situations where the prices of items are not what is charged when you get to the cash register. I am not complaining, but it’s very confusing for someone who likes to do arithmetic before they get to the cash register (add in the GST and estimate how much the entire order will cost).

As an example on Friday night my family was visiting my in laws. We went shopping at Wal-Mart and found an air mattress and sleep bag combination product with a picture of Lightning McQueen on it for my son to sleep on(We had forgotten his air mattress) and the price on the product was $29. That seemed fine and we went and picked up a few other items and got to the cash, we paid what was asked and when I got to the car I told my wife, “Something is wrong with that total, we should have paid about $110 not $85″, sure enough we looked at the bill and the sleeping bag combo was actually $15 but it had not been marked down. I was happy to get the discount, but confused as to why Wal-Mart doesn’t advertise the actual sale price in the store (maybe I missed it when I picked up the item).

The Bay and the Wheel of Fortune Pricing

I have given up trying to figure out how much any item at the Bay costs, especially if it is a sale weekend (which is pretty much every weekend).  I never know what the final total is going to be and I have given up even trying to attempt an estimation. Two examples of this are:

• On the scratch n’ save weekends, the items I seem to buy are already on sale and then the scratch ‘n save kicks in and then there are sometimes other magical discounts too. One time I bought a set of trousers that I thought were $65 and ended up paying $36 total (after taxes). I asked the clerk if she was mistaken she just shrugged her shoulder and said, “I just work here”.
• I was purchasing a traditional Christmas gift for my wife and when I got to the cash, due to the number of sales and discounts the cashier asked me, “How much are these?” (she asked this AFTER she attempted to scan it, and got a price she didn’t believe). I said, I think they are on a one day sale for $3.99 each, so she overrode the price and sold it to me for that price, and I found out later that the price was actually $4.99.

My real question is how do stores stay in business if this kind of price methodology in place? It suggests a few things to me:

• Their mark ups must be astronomical because they don’t seem to care how much they sell any item for these days (wish the gas companies did this).
• The retail business right now is SO cut throat “discounting” is now the norm and not the exception (or at least making the consumer think they are getting a discount).

Does anyone have any insight as to how these firms can stay in business?