How Good Is That Sale...Really?

We all see those sales that look unbelievable so we got to go shop for everything we ever needed or wanted. They are especially prevalent in late summer and around the Christmas shopping season. Have you ever noticed how once you go to check out it still seems like your spending a lot? Are you really getting as good of a deal as you thought? Let's take a look at the three most common "huge" sales and see how good they really are.

Store closing sales
In my opinion these are one of the biggest rip offs out there. The store spends a ton of money advertising that they are having their sale and raise their prices as much as 50%. Here's and example of how they may run their sale:
Weeks 1 and 2: 25% off everything
Weeks 3 and 4: 50% off everything
Weeks 5 and 6: 75% off everything
Weeks 7 and 8: 90% off everything

Now let's say that the store only marked up 15% for their closing how much do you really save on a $100 item?

Pre sale price $100
Additional markup price $115
Week 1 and 2 price $86.25 13.75% savings
Week 3 and 4 price $57.5 42.5% savings
Week 5 and 6 price $28.75 71.25% savings
Week 7 and 8 price $11.50 88.25% savings

Now as you look at the above examples you may think that if you just wait until week 5 your still going to get a great deal but stores know people run to liquidations so most of the items you would want are already gone. Which is why their more than happy to raise the discount as time goes on because everything after week 4 is pretty much dead inventory anyhow.

Spend X and get Y
This is where you spend $50 and get $10 store credit that you can use at a later date. If this is being run with another promotion and their are other items that you need but can wait for this may be a great deal.

Let's say the store is doing a 25% off sale plus for every $50 you spend you get $10 store credit. Your interested in a $100 item so the sale price will be $75 plus $10 store credit and you need a $10 item that you can wait on. So your total purchase is $110 but you get the 25% sale and $10 credit you pay $75 this gives you a savings of almost 32%.

The biggest way to lose on this type of sale is to buy extra items to get the $10 credit and have no need for additional items.

X% + X%
I really hate how deceptive this sale is because it depends on two factors. First people do not understand how the sale works so they overestimate their saving and second the stores rely on people avoiding confrontation.

You may see a sign that says 25% off plus take an additional 25% off between 10 and 1. Here is where it gets deceptive since you were taught in school that in a word problem if you see the word plus it means to add. A lot of people will look at a sign like that and think 25 plus 25 = 50 and assume that means they get half off. They only realize the error once the check out and seem to spend more than they thought.

Lets use your $100 item again. Here's what you would pay on a 25 + 25 sale:

$100 Item price
$25 First 25% off
$18.75 Second 25% off
56.25 Final Price

As you can see you didn't get the 50% off they suggested and only got a 43.75% discount. These are especially deceptive on end of the season sales where it is not uncommon to see X%+X%+X% often times adding to 100% or more. 50+25+25 seems to be fairly common and simple math looks like 100% savings but in reality it's only 71.875% off.

There are great deals out there and lots of different sales. The biggest thing to remember is that the people who put these sales out are not trying to get you a good deal but to get you to spend more than you normally would have. Make sure you know how all sales work and judge for yourself how good a sale really is.