I’ve long considered myself a fantastic buyer. Notice I don’t say shopper – that alludes to a hobby or form of entertainment. To me, buying is serious business.
Even before I had any serious degree of financial success, many people assumed I was rich because of my material posessions. I guess most people could pull that off by maxing credit cards, but I was actually socking money away for later.
How do I do it? Read on…
The most important thing to remember is value. Sounds obvious, but nearly everyone ignores value on a daily basis. Value means that you’re getting the most for your money – not that you’re saving the most money necessarily. A Rolex at $1000 might be an incredible value, but a Timex could be a rip off at $150.
Ok, ok… you’re not an idiot. I get it. Moving on… I find that in general the best values can be found at the end of the spectrums. A $20 bicycle is probably a good value even if it sucks because at the improvement over not having a bicycle is huge. For example, I needed to hang some speakers a few hours ago. I went to Wal Mart and bought speaker mounts for $9 each. That’s dirt cheap. They’re not fancy, and they’re kind of annoying to set up, but it’s WAY better than not having speaker mounts.
At the other end of the spectrum is the super high quality. In many cases the MOST expensive item isn’t the highest quality, but the next cheapest or third cheapest is. In this range, there is so much attention to detail that you are likely buying something that is genuinely valuable. It has higher quality materials, more features, and better worksmanship. There is always a demand for these items, so they retain their value.
In the middle, is a lot of garbage. Usually a few steps up from the cheapest you’ll find something 10% better for twice the price. The reason is that they have a large marketing budget and they have to pass that cost on to you. Higher than that are the items that are posing as top tier items – they have the flash, but not that quality. Resale on these is usually awful, leaving them with poor value.
So, rule #1 – Always buy the Best or the Cheapest. I follow this rule religiously. Basically everything I own is either bought at Wal Mart or has been researched and ordered online.
Next, it’s extremely important to determine what is the best. It’s very common for companies to try to trick consumers by outpricing the actual best in class, or spend more money marketing. If you have two products, equal in price and one is marketed much more aggressively, it’s usually worse. Why? That marketing money has to come from somewhere.
For example, take Bose speakers. To people in the know, it’s common knowledge that they are not very high quality. No true audiophile would be caught dead with them in his home theater. However, most people perceive Bose as being the best because of their aggressive marketing. Have you ever heard of Outlaw audio? Probably not, but they are incredibly high quality products priced much cheaper than Bose. They do almost no advertising.
Another good example is high end blenders. There are really only two companies that produce them – BlendTec (also known as K-Tec) and Vitamix. Many people have heard of Vitamix, but few people know about BlendTec. Both are priced at the same level. For the most part, they are the same – they’re both very powerful and have the same high quality type of assembly. The difference is that the BlendTec is 3 horespower versus the Vitamix’s 2 horsepower, and the BlendTec has more advanced programming (although I think Vitamix may have caught up on that by now). Which would you rather have?
The best way to find out the best product in a category is by searching on the internet – specifically in forums. People in forums are totally crazy, and in many cases spend their entire lives researching to find out what the best of something is. Let them do the work for you.
Sometimes you’ll be surprised – the one you think is the best may actually be the best. For example, Rolexes really are superior watches. Before I lost it, I had one and I would take it to black tie events (if I went to any), as well as scuba diving and sky diving. Cartier, Tag Heuer, and many other competitors are more expensive or equally expensive, and are far inferior. However, if you did your research you’d also find out that Omega watches are on par with Rolex and come in styles that may be appealing to you.
Thus, rule #2 is Know what the Best is. I’m always interested in knowing what the best is, even if I’m not interested in that particular item.
How do you decide whether to buy the cheapest or the best? The goal is always to end up with the best – if you care. If you don’t care, then just buy the cheapest and save your money for the best of some other item. For instance, I don’t really care about vacuum cleaners, so I bought the cheapest bagless one. I’d like a Dyson or Kirby, but it’s not important enough for me to spend the extra several hundred dollars.
Sometimes you can’t afford the best, in which case you buy the cheapest to tide you over until you can. That way when you can upgrade, you don’t mind getting rid of the cheap one. If you spend more money you might be tempted to not upgrade.
Of course you also want to make sure that you’re getting the best price possible. Except on the cheap items, this will almost always be online. The best sites to look for deals are Fatwallet Forums and Ben’s Bargains. I probably get 50% of my purchases from there.
Always check ebay for a reference price. Make sure you pay attention to what things are actually being sold for. A completed auction for $300 means a lot more than an auction at $400 with no bidders. If this price is cheaper than you can find on Fatwallet or Ben’s Bargains, just buy there. If not, you know that you can always resell on ebay later if you change your mind about the product. A lot of people have the misconception that ebay is sketchy or that you are getting used or damaged products. The truth is that ebay is now, more than anything, an easy way for small businesses to make sales. 90% of what you buy will be brand new, and if it’s not, it will be labeled as such.
I also check Craigslist as well as Froogle. Froogle is Google’s price search engine. It takes a little getting used to, but you can find some great deals. For example, last night I wanted to buy a food dehydrator (the best one, the Excalibur 2900). Ebay showed me a price of around $210+ shipping. Other stores sold it at $210. I dug through Froogle a bit and found it for $185.
Rule #3 – Always pay the best price. Groundbreaking, right?
Actually, I then used one of my advanced tips to get the dehydrator even cheaper… but (you guessed it) those will come next time. For now I have to take a nap early so that I can go to a tea party. Also, I’m straight. Honest.