What Are Buying Strategies - Financial Literacy - أول ثانوي

2.3 What Are Buying Strategies? Learning Objective Once you have completed this lesson, you should be able to: identify the advantages and disadvantages of comparison shopping in different places ⚫ identify strategies that consumers can use before, during, and after a purchase to help them maximize their purchas- ing power. Key Terms Comparison shopping Unit price Bankrupt Buying Strategies Sellers have strategies to encourage you to buy. As a consumer, you should have strategies to help you maximize your purchasing power. Some ideas to help you in your role as a consumer are given in the fol- lowing sections. Before You Shop Prior to shopping, there are some things you should do to help make the most of your shopping experience. As a consumer, you should take the following steps to make the most of your shopping: 1. Comparison shop. 2. Plan your purchases. 3. Pick the best time to shop. 4. Research businesses. وزارة التعليم 123-1445 Link to digital lesson www.lem.edu.sa CHAPTER 2 Spending 55

Comparison shopping checking prices, brands, and quality among several sellers to make sure you are getting the best deal 1. Comparison shop The Internet is a good resource for comparison shopping. By checking competitor websites, you can learn about: • product prices product features special offers. There are advantages and disadvantages of online comparison shop- ping (see Figure 2.3.1). Note that before shopping online, you should check the shop to make sure that it is genuine. Otherwise, you risk being exposed to electronic fraud. FIGURE 2.3.1 The Advantages and Disadvan- tages of Online Comparison Shopping Advantages It is quick to visit many different virtual locations. You can gain a lot of technical knowledge about a product which might be difficult to do in store. Disadvantages It is hard to judge the quality of an item from an image. There may be limited time offers which increase impulse purchasing. What Umpan sun websites have y marsed! Why have used fer?- 56 شركة السفر والسياحة Traveling and Tourism Company

You can also go to shopping malls or stores to comparison shop. There are also advantages and disadvantages of comparison shopping in a physical location (see Figure 2.3.2). Advantages Disadvantages You can better judge the quality of It takes more time than online an item. You can check whether an item is good value or not. You have immediate access to the item. comparison shopping. You do not always have easy access to as much information. You may not be able to keep notes as easily. FIGURE 2.3.2 The Advantages and Disadvan- tages of Comparison Shopping in Malls/Stores To help you comparison shop, it may be useful to keep notes on the prices for which an item is sold by different retailers, and any other advantages or disadvantages in buying the item from these retailers. An example of some comparison shopping notes is shown in Figure 2.3.3. Notes for New Smartphone Large phone retailer ⚫ Available for SAR 2.599 (saving of SAR 900 compared to the original price of SAR 3,499). Can have it delivered tomorrow or pick up from showroom today. Manufacturer's website • Available for SAR 2,699 reduced from SAR 3,499. • Wider choice of colors and options than at the large phone retailer. Local mall . May be worth looking in some smaller shops to see if they have a better price: . Also, want to test the camera before purchasing although it has good reviews online. FIGURE 2.3.3 Comparison Shopping Notes for a Smartphone 2. Plan your purchases Prepare a shopping list of the things you need. Decide ahead of time what you will buy and approximately how much you will spend. Planning ahead will help you avoid overspending or buying items that pul yall de hat need. 123-1465 CHAPTER 2 Spending 57

Are all items purchased on sale good value? 3. Pick the best time to shop Shopping can be a tiring and stressful activity if you don't shop at a time that works well for you. Do not go shopping when you are very sad, angry, hungry, or even unusually happy. Strong emotions can lead to impulse purchases which you may later regret. 4. Research businesses To make sure you are shopping at a reputable business, use local guides and consult sites where customer reviews are displayed. If shopping online, research websites before you place an order. If the price seems too good to be true, the product may turn out to be low quality - or, if you are exposed to electronic fraud, you might not even receive it. While You Shop The following strategies should be used when you shop: 1. Avoid impulse buying You can avoid impulse buying by: ⚫ taking a list with you when you shop and buying only what is on the list ⚫ avoiding products on display that attract your attention but are unnecessary ⚫ not making last-minute purchases at the checkout ⚫ not buying something just because it's on sale. SALE - 63 درارة العا 58

2. Read labels Know ingredients and materials and what they mean. For example, a shirt that is 100% cotton will probably shrink if you wash it on a high heat and may be uncomfortable in warm weather. 3. Understand sales terminology ⚫ A sale means that goods are offered at a reduced price for a short period of time. Clearance means the business wants to sell old stock to reduce storage costs. Liquidation means the business wants to sell everything right away, often if a business is going bankrupt. 4. Read contracts If you are making a purchase that requires a contract, be sure to read and understand it before you sign it. 5. Calculate unit prices The lowest unit price for products of comparable quality is often the best buy. Figure 2.3.4 shows how to compute unit prices. Bankrupt a person or organization declared by law as unable to pay their debts Until price the cost of an individual.item when sold as a multipack The formula for calculating unit prices is: Price of the item Number of units per measure The unit costs of a 5kg bag of white rice that sells for SAR 25 and a 10kg bag of white rice that sells for SAR 40 are calculated as follows: SAR 25 5kg = SAR 5 per kg SAR 40 = SAR 4 per kg 10kg The 10kg bag therefore has a lower unit price, and may be a better buy if the consumer thinks they will use all of it. وزارة التعليم 20173-1445 FIGURE 2.3.4 Calculating Unit Prices CHAPTER 2 Spending 59

وزارة التعليم 60 Financial Literacy 6. Determine the quantity needed A bulk buy option often has a cheaper unit price than a single item. However, if the item is perishable and such a large quantity is not needed, the higher-priced single item may work out more economical. 7. Compute total cost Check the total cost of a product, including additional items (such as batteries), shipping and handling charges, finance charges, and other additional or hidden costs. 8. Ask about exchange and refund policies Make sure you understand what items can be returned, and for what reasons, as well as how much time you have to decide if you want to return an item. After You Buy There are also things customers must do after they make their pur- chases. 1. Keep receipts and warranties For all major purchases, keep receipts and warranties for possible use later. A warranty is a statement guaranteeing the quality and perfor- mance of a product or service. Print out and keep warranty statements and sales receipts from online purchases as well. 2. Evaluate your purchase You will be evaluating the purchase by deciding if you are satisfied with what you have bought. This will help you make better decisions in the future. There can be a sense of immediate satisfaction in making a pur- chase, but this may be short-lived. By evaluating your purchase later, you are also teaching yourself that this feeling is often temporary. 3. Help others shop wisely Tell others when you have a good experience. Likewise, when you are treated unfairly, share those experiences with others.

LOOKING AHEAD What products might you be happy to spend more on for quality in the future? Why? To help structure your answer, consider: 1. How long are you likely to keep the product for? 2. What is the value of the additional quality? Review Questions Choose the correct answer. 1. Which of the following is a disadvantage of online comparison shopping? a. quick process b. lots of technical information c. may increase impulse purchasing d. easier than in-store data gathering 2. It is easier to judge the quality of an item by going to a physical location. a. true b. false 3. The best time to shop is when you are very happy. a. (rue b. false 4. While you shop, it is important to a. make last-minute purchases at the checkout b. read the labels on Items you are planning to buy c. ignore sales terminology d. buy items only because they are on sale 5. It is important to plan your purchases a. true b. false 6. Which of the following is the best time to shop? a. when you are frustrated b. when you have completed lots of research .weryou are feeling hungry or emotional d. "when you are sad ورارت اسكليم 2073-1445 CHAPTER 2 Spending 61