Personal Finance

How To Create A Price Book

By David Krug David Krug is the CEO & President of Bankovia. He's a lifelong expat who has lived in the Philippines, Mexico, Thailand, and Colombia. When he's not reading about cryptocurrencies, he's researching the latest personal finance software. 11 minute read

Grocery shopping can be difficult on a limited budget. If you’re buying one big item, such as a kitchen appliance or a computer, you can research costs ahead of time and pick the retailer with the greatest deal. 

However, you might not want to or be able to spend the time necessary to shop around for the best price on everything on your grocery list, especially if you’re short on time.

Despite what the ads may say, there is no one store where you can always find the best prices. In 2014, Kantar Retail conducted a study that demonstrated this by contrasting the costs of food at six discount supermarkets. 

The research revealed that some products were more affordably priced at some of the six retailers than at others and that no single retailer offered the best overall value.

As a result, it’s safe to assume that you’ll pay more for some groceries if you do all your shopping at a single store, regardless of whether you want to shop there or not. You need to search around to find the lowest price possible for everything you buy. 

Based on the Kantar study, you can save money by purchasing peanut butter from Walmart, where a jar costs only $1.82, rather than from Aldi, where it costs $2.29. Next, you’d swing by Aldi on the way home to pick up a loaf of bread for $0.89, as opposed to $1.38 at Walmart.

Unfortunately, most grocery lists consist of more than just staples like bread and peanut butter. Every month, the average consumer spends over $100 on food, and in many places, they have their pick of five or six different supermarkets.

How can one possibly remember which shop sold what item at what price given the sheer variety of options available?

For that, you need a price book. After some initial setup time, you will have instant access to the lowest possible pricing on anything you purchase. In this way, you may arrange your shopping excursions so that you take advantage of the sales happening at each store. 

With a price book in hand, you may shop around for the best deal, just as you would for a major purchase.

How a Grocery Price Guide Operates

Amy Dacyczyn, the editor of the cheapskate publication “The Tightwad Gazette” in the early 1990s, came up with the concept of the grocery price book. 

Her book “The Complete Tightwad Gazette” details how she began keeping track of costs after seeing significant variation between retailers. She calculated that if she spent less overall, she could defeat them at their own game.

According to research conducted by the Federal Trade Commission in the year 2000, the normal pricing of most grocery store items remains the same throughout the year. Prices like this occasionally go on sale, but they nearly never go lower.

The original inspiration for the price book came from Dacyczyn, who kept a little notebook of the typical prices of the items on her shopping list at each local store. If frozen peas were on her list and she knew she could get them at six different locations, she would write down the pricing at all six. 

By doing so, she was able to quickly ascertain which shop had the lowest price for any given item. Therefore, she was never confused about what to buy or where to find it, regardless of sales.

Data found in a price book

A price book’s structure is flexible, but all of them include the following elements:

  • Category of Goods. Eggs, aluminum foil, or whatever it is you’re trying to determine the best price for. Dacyczyn can quickly browse the range of costs associated with a given product category thanks to the dedicated pages in her pricing book.
  • What the shop is called. Don’t forget to list all of your regular retail establishments. Use either the entire name or an abbreviation, such as “S&S” for Stop & Shop, to identify the retail establishment.
  • Well-known Name-Brand Item. You can list many brands at the same store, or simply the one brand you choose. For store brands, you can either repeat the store’s name or just use the abbreviation “SB” for a store brand.
  • Comparing sizes and costs. List the regular price of the item and how much you get for that price. You might write $2.00/18 oz. for a jar of peanut butter that holds 18 ounces.
  • Unit Price. Use the pricing and size information to compute the unit price for each item. This step is vital because it’s the only way to evaluate whether an 18-ounce jar of peanut butter for $2.00 is a better deal than a 16-ounce jar for $1.80. If you are going to write down a unit size, be sure the unit is correct before you start writing. 

When it comes to olive oil, for example, you may find bottles marked in ounces, quarts, and liters. If you want your unit costs to all to be in the same units, check the label on the packaging and convert the units.

These are the bare bones of a pricing book, but there’s plenty of room to expand. Some people like to include a separate column for special remarks, such as organic or best sale prices. Others include the date for each listing, so they know how old the pricing is.

Here’s an example of how all this information may come together on a pricing book page:

Oil, Canola
StoreBrandSizePriceUnit Price
S&SSB1 gal.$10.99$2.75/qt.
AldiSB1.5 qt.$2.69$1.79/qt.
WFBulk organic1 lb.$2.19$3.83/qt.

In addition to helping you save money every day, a price book may be used to evaluate the quality of an offer. If you have a pricing book and your supermarket has pasta on sale for $1 per pound but Walmart regularly sells it for $0.85 per pound, you know the sale price isn’t a good deal.

Making a Price Book for Groceries

1. Choose a Format

It’s not necessary to use a physical book to use a pricing book. There are a variety of printed and digital options for keeping track of prices, each with its own set of benefits and drawbacks.

Your first step should be to choose a format that works best for you.

  • Paper and Pencil. A handwritten notebook with a separate page for each item on your shopping list is the simplest form of price book to create. A loose-leaf binder is ideal since you can easily swap out pages as needed while making adjustments to your grocery list. Picking a notepad that can easily fit into your bag or pocket is also helpful. This price book makes it simple to look up costs when out shopping, but it requires manual crossing out and rewriting of new prices.
  • Free Forms to Print. You can save time while making your own price book by using a template that you find online. Typically, you’ll find a blank table containing rows for Product Type, Retailer, Brand, Unit Price, and Date. However, most templates are the size of a full sheet of paper, making it impractical to carry around a little notepad in a pocket.
  • Spreadsheets. Spreadsheet programs like Microsoft Excel and Google Sheets can also be used to keep track of supermarket prices. It’s simple to create your own pricing book spreadsheet with columns for a product, store, brand, and price, or you may use one of the many available online. The unit cost can be calculated automatically in the spreadsheet depending on the selling price and the quantity entered into a formula. Keeping track of your inventory is a breeze when you use a spreadsheet that allows you to easily add and remove items as well as categorize them according to a category, manufacturer, or retail location. When you go shopping, you can make a list of what you need and have the entire amount calculated as you go. A pricing book created in a spreadsheet can be cumbersome to use on a mobile device, making it inconvenient to consult on the go.
  • Applications for mobile devices. If you’re the kind of person who never goes anywhere without your cell phone, a mobile app may be the easiest method to track and compare supermarket prices. ValueTracker for iOS (0.99 dollars) and Sharky Shopping for Android (free) are two well-liked pricing books. Apps that keep a price book can do things like automatically build shopping lists and do unit pricing calculations. In order to use them, though, you’ll need a smartphone and an app designed for your model.

2. Describe your regular purchases

You don’t need to enter every single thing you purchase when you first set up your pricing book. You just need to add the goods you buy the most of, as the more frequently you buy anything, the greater the savings you will realize from purchasing it in bulk. 

You might begin by making a list of the top 10 or 20 goods you regularly purchase and expanding from there.

If you prefer to keep track of things in a physical notebook, make sure to give each item its own page and write the name of the object clearly at the top of the page. You should enter one item per row in a spreadsheet. Adding new things to an app requires following the app’s guidelines.

3. Check Prices

Price-checking all of the items on your list is a time-consuming next step. Begin your grocery store trip by looking for the goods on your list in the circulars of the area’s supermarkets. Check the stores’ websites if you don’t get fliers mailed to your house.

Don’t forget to make a note of the price in your price book every time you see one of the items on your list in a circular. If you want to know how much anything costs per unit, it’s important to know how much the package contains. 

Make sure the usual price is included as well if the price given in the flyer is a sale price; that’s the one you want to keep an eye on.

Stores don’t always include the same products in their weekly flyers, so you might not be able to find every price you need this way. The next thing to do is to examine prices by looking at recent food store receipts. 

While receipts are useful for locating prices on frequently purchased items, they may not always provide information on package sizes. If you have a receipt that says something like ORGANIC THOMPSON RAISINS $2.99, but it doesn’t specify how many servings are included, you’ll need to locate the item on the shelf.

You can find prices for most of the things you buy in the store’s flyers and on your receipts. However, you might need to check the prices shown on actual store shelves to fill in the blanks.

Make sure to double-check the pricing of any unfilled goods in your price book the next time you go grocery shopping. Do this in order at each store until your price book is full.

The Best Use of Your Price Book

Always have a pricing book with you when you go shopping. If you only need one specific item, you can use your price book to determine where to buy it at the best price. 

Checking the costs of each item in your price book, adding them up, and figuring out where they cost the least in total will help you decide what store to visit if you just need a few things and want to make one trip.

It is easier to see how big of a range there is between grocery shop costs if you have a broader list of items to purchase. If the price differences are negligible, it may be more convenient to make a single trip to the retailer that offers the lowest total price. 

It may be worthwhile to shop at both locations if you find that some of your desired items are significantly less expensive at one location while others are significantly less expensive at the other.

To help you get the most bang for your buck out of your price list, consider the following:

  • Create a schedule for your grocery shopping. Going to several stores to find what you need doesn’t have to be a pain. If you want to shop at a different retailer every week of the month, Amy Dacycyzn suggests setting up a regular rotation. If you find that you go through certain things on your list more quickly than others, you can either stick to buying at the stores that provide the best bargains on the things you use most frequently or only occasionally visit the places that have the things you use less frequently. You could, for instance, get your weekly supply of milk and eggs at the cheapest grocery store, and your monthly supply of flour and sugar at the cheapest warehouse club.
  • Go out of your way for Extraordinary Deals. There’s no need to limit yourself to just one trip to the supermarket per week; instead, you can make extra stops when there’s a particularly good bargain. Your price book will indicate whether or not the discounted price is substantial enough to warrant making the trip. However, keep in mind that you get the most bang for your buck on these excursions if you stock up on multiple discount products all at once. Your savings on milk will be offset by the cost of petrol if you drive seven miles round way for a discount of forty cents per gallon.
  • Master the Art of the Sales Cycle. Grocery and home item sales tend to repeat themselves periodically. Most food goods, says Coupons How-To, go on sale once a month. But some have shorter or longer cycles; for example, cereal is often on sale every six weeks, while baked goods have a longer average cycle time of about two months. You can save money by keeping track of the lowest possible sale price and the dates on which you can anticipate finding it by doing some research into when your favorite stores run sales on the products you often purchase. This way, you may buy in bulk during sales and avoid ever having to pay full price again.
  • Alter the Cost Record. Keeping your price book current is essential to its usefulness. If you see a price that has changed, make a note of it in your book. Your price list should be reviewed and revised annually.

Bottom Line

To some extent, a grocery price book is more than just a useful resource. Farmers’ market prices, for instance, might vary widely from one week to the next due to the seasonality of the many goods sold there. Keeping a record of these prices won’t be very useful, as they will likely have changed by the time you return to the market.

Luckily, prices in the grocery don’t fluctuate quite so frequently for most items. The price you record in your book will usually be honored for several weeks or even months after you make the entry. 

And when shortages drive up the price of a particular food item, like orange juice, prices tend to rise uniformly across all retailers, meaning that whichever store had the lowest price before the increase will likely have the lowest price afterward.

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