Black Friday is every retailer’s biggest income day for the year. But, why is it called Black Friday? Because it’s the day that retailers make their greatest profits in black ink.
Black Friday, the glorious day shopaholics and savers have been waiting for has come and gone, and you’ve now realized that to your wallets dismay you have spent way above your budget! But why?
It wasn’t planned, sometimes these things happen… We’re sorry to say, we could have told you so! Black Friday and sales are carefully engineered to get you to spend as much money as possible.
So if or when you see the sign SALE and you get excited, we’re talking to you. Here’s how sales actually make you spend more:
Sales, coupons, deals whatever you want to call them, are carefully engineered to get you to spend more. It’s called Loss Leaders.
Loss Leaders are items that the store loses money on, these are basic items that you buy often. While Thanksgiving has just passed, Luxury aside, let’s use Turkeys as an example. Around Thanksgiving, Turkeys are a tradition, with the cost of one turkey being approximately $5 (R70), the stores also knows that you’ll need freshly baked bread, cranberry sauce, vegetables and gravy. So what happens next? The stores will increase the cost of these items to make up for the losses on the bird.
Loss Leader sales also come with limitations, for example; when you spend R1 000, you’ll receive 30% off. This is where you get caught: The “when you spend this much” part covers the loss of the sale. Yet you automatically feel like you are getting a great savings deal, the problem is, you were never planning on spending the R1 000 to start with.
Keeping that in mind, you should always be wary of huge discounts, retailers often increase the price of an item and then place the price of the discount item below the original price, making you think that you are getting a better deal than what you bargained for. These techniques are all designed to get you to spend money on items that you weren’t planning on buying, and best of all, we actually fall for it.
So what do you do now? Return the items? Yes, that’s an option and it’s entirely up to you. We deserve to treat ourselves and shouldn’t feel guilty about it, but the problem lies if you have overspent.
So what’s your next option? When you see special deals and the four lettered beloved word SALE, always follow the golden rule: When going to the shops, only purchase what you planned to buy in the first place. Swhether or not there’s a deal, a discount or a coupon, and if it does just happen to be on sale, lucky you!
Overspent? Why not take a look at taking out a loan?