Even I don't always agree with my opinion

 

Purchasing Groceries Online

2
Posted December 28, 2017 by jim young in Business

“It’s nice to have valid competition; it pushes you to do better.” – Gianni Versace

Before our move to Loring, Ontario last year we carefully considered many factors such as the availability of medical services, beer and liquor and of course groceries. And while Loring does NOT have a grocery store, the allure of living in a small town in a remote area of Northern Ontario outweighed the convenience having of a nearby grocery store.

Recently I stopped in at Buchanan’s Hardware Store in Port Loring (which is right beside Loring) to purchase a couple of screws for a project I was working on at home.

In addition to all the typical things you might expect to find in any Hardware Store, you will also find a small selection of groceries at Buchanan’s.

When the Grocery Store in Loring went out of business a few years ago, Buchanan’s Hardware and Rupert’s Variety Store in nearby Arnstein expanded their inventory and began carrying a small selection of groceries to supply the residents of the area with their basic needs.

The nearest full service grocery store to us is almost an hour away in Powassan.

As I paid for my screws I wondered to myself if I had the option of having just a hardware store closeby or a grocery store – which would I choose?

I think I would choose a hardware store.

That might surprise you when you consider we require groceries more often than we require hardware.

However, you can plan your grocery shopping and stock up on items needed for daily meals.

With a bit of planning, you don’t need to shop for groceries once a week. It can be done on a monthly basis – or less often if you have a freezer and ample storage.

But many items purchased at a hardware store are needed due to repairs that sometimes demand a sense of urgency. How can I visit a hardware store once a month with a list of things I might need to repair a faucet that hasn’t started leaking yet; or to repair a screen door that is currently working fine at the moment?

So we carefully plan our food shopping lists now to minimize our long trips to the grocery store.

Of course we don’t always anticipate extra company for dinner, or a sudden urge for potato chips and dip. But thanks to Buchanan’s and Rupert’s – those unexpected “emergencies” are covered.

Still, with the ever increasing price of fuel, we try to minimize our trips to Powassan (or Sudbury where the nearest Costco is located). We have been able to accomplish this by purchasing our non-perishable groceries online at Walmart.

With prices comparable to everyday Walmart prices and free shipping on orders over $50, shopping for groceries that are available online is a no brainer. (It doesn’t take long for your grocery bill to add up to $50 to meet the Free Shipping eligibility.)

Walmart does charge a small handling fee of $5. But when you calculate the cost average across your entire grocery bill, this fee is negligible especially when you consider the alternative is to drive an hour to the closest grocery store.

Most often the anticipated delivery date is quoted at 5 business days. However, with the exception of an occasional item that is out of stock, or being shipped from an alternate location, we usually receive our groceries in 2 business days.

And now, with the announcement of Amazon’s acquisition of the Whole Foods chain of grocery stores it looks like we have yet another option.

Amazon doesn’t even charge the $5 handling fee incurred by Walmart orders and you are only required to order a total of $35 of goods to receive free shipping. Delivery times are comparable to those by Walmart.

The great thing about competition is that it forces businesses to ensure they are always offering the best prices and customer service.

So I decided to undertake a small survey to see whether Amazon or Walmart was giving me the best bang for my buck by comparing the prices of over 50 grocery items.

Assumptions
When comparing prices, it is important to ensure you are not comparing apples to oranges, not that Amazon or Walmart offer either apples or oranges for online shipping anyway.

So I ensured each item I compared was identical in brand and pack size.

The biggest challenge in price comparison involved Amazon’s diverse line of products from third party sellers. Some items that I looked at were available at outrageous prices from a third party. For example, you can find listed on Amazon – Evian Bottled Water in 1 litre bottles for a price of $123.95 for a pack of 12 PLUS shipping charges.

No one in their right mind is ever going to make a purchase such as this, so I eliminated these and considered only products that were available through Amazon AND covered by their free shipping.

General Analysis

At the end of the day, if you purchased all 54 items that I compared in the table below, you would pay a total $325.62 for them at Amazon. The same items at Walmart would cost you $1.59 more, totalling $327.21. But that increases by another $5.00 when you account for Walmart’s handling fee.

Including Walmart’s $5.00 handling fee, the cost average on these 54 items then is 12 cents more per item. Walmart would do well to consider eliminating this handling fee now that there’s a new kid on the block.

But does that mean you should shop for your groceries online at Amazon? Not necessarily.
It depends on what you’re buying.

Crisco Canola Oil is $3.00 cheaper at Walmart while your biggest savings of $2.00 at Amazon comes with a purchase of Duracell 9 volt batteries.

Price variances ranged from $.02 to $3.00 per item with half of the items that differed, offering a variance of less than 50 cents.

A whopping 80% of the items compared were identical in price.

Of course you can compare prices each time you shop and split your orders between Amazon and Walmart ensuring you’re getting the best price from both companies, but who wants to spend that much time shopping?

Additional Purchasing Considerations

Walmart
No Name Products. Walmart carries various No Name products that can usually be purchased for less than the name brand versions. The brand name may be important to you for some things, but often the cheaper No Name products are just good and will save you money.
Handling Fee. While the $5.00 handling fee charged by Walmart may seem negligible, it’s still money that could be in your pocket. Walmart seriously needs to reconsider this fee if they want to remain competitive with Amazon.

Amazon
Pack Size. Some items are offered for less money in pack sizes even larger than you would expect to see at Costco. Unless you were purchasing some of these items for a special event, the quantities seemed unreasonably larger than what an average household might consume so I did not include these prices in my comparison.
Subscribe and Save. Amazon offers you an additional 5% to 15% savings on some items with their “Subscribe and Save” option. All you have to do is select 5 or more items offering the “Subscribe and Save” option to ship every 1 to 6 months at your choosing. You will receive an email prior to the shipment as a reminder, at which time you will be provided the option of skipping or cancelling any item prior to shipping. And in addition to the extra savings this option offers, you will save time by not having to reorder items you use on a regular basis over and over again.

Summary

There were several items I would have liked to compare that were not available at Amazon – more so than vice versa. I imagine expanding on their product lines will be an ongoing process for Amazon and hopefully this issue will be resolved in the near future. Perhaps during this process Amazon will consider offering some No Name brands of groceries for even more savings.

If Walmart is interested in keeping my business they will have to drop their handling charge – very soon. While a $5.00 handling fee may seem negligible, if I order from Walmart 20 times, that’s an extra cost to me of $100 that Amazon does not charge me.

Walmart would also do well to learn from Amazon and offer a “Subscribe and Save” feature of their own.

Now we need Costco to throw their hat in the ring and offer groceries online as well.

– 30 –


2 Comments


  1.  
    Anonymous

    That was a very time consuming and extensive survey you did. Excellent work!




  2.  
    Block

    17 years ago we lived in Toronto and used Grocery Gateway. Order on line and receive free home delivery. After moving to Barrie I realized Grocery Gateway didn’t operate in the area (anywhere outside of the GTA). Sad to loose this service, we carried on. Now I’ve heard you can order online at Walmart and pick it up. Saving 1 to 1 1/2 hours of shopping time. Only problem is I am not a Walmart shopper! I fine their selection of grocery to be limited and their house (Great Value) brand to be of poor quality compared to others stores house brand. Having said all that. I am a Amazon Prime member and will diffidently look into Groceries. Didn’t even think of them for food. Online shopping (for everything) is the future and we all should embrace it.





Leave a Response