F1.5 Describe some ways of determining whether something is reasonably priced and therefore a good purchase.
Skill: Determining the Criteria for a Good Purchase
A good purchase must take into consideration several factors other than price. In order to consider if a purchase makes good financial sense, it is important to determine, first of all, if it is a need or a want. Then, it is necessary to establish criteria to make the right purchase. These criteria, which include price, can also take into consideration the brand, the quality of the product, promotions, where it was made, if it considered to be fair trade, the delivery costs, the return policies and the environmental impact of the packaging. From a financial point of view, it is important to be able to purchase the product outright or to be able to make the necessary payments during a certain period.
Students can also explore and discuss the financial benefits and safe ways to purchase second-hand items. They can research various consignment, second-hand, community, and other stores in their environment and discuss the importance of these stores in terms of the financial and environmental impact.
Students should be able to differentiate spending money on things that are needed versus things that are wanted, thereby developing criteria related to what constitutes a reasonable purchase. Students can demonstrate their understanding of a reasonable purchase by justifying their thinking and using appropriate vocabulary.
For example, they might ask themselves:
- Is this purchase necessary?
- What will the product be used for?
In addition, the student will need to understand that other criteria, such as price comparison, bias in advertising, and merchant reputation, are also part of the criteria to consider when making a purchase.
It should be noted that in some areas of the province, the cost of the same item can vary greatly. The cost varies according to location and population density, but also according to the financial and economic reality of the region. Some large retailers offering discounted prices are not located near small towns, which prevents citizens in these areas from taking advantage of more competitive prices. In addition, some merchants will post higher prices in some areas of the province, because the average salary is a little higher than the provincial average, not taking into consideration the population with modest incomes. In order to establish criteria that will make the discussions objective, it is important to include all the realities of the students in the classroom, and those of the province.
The marketing strategies used by different companies rely on cognitive biases to promote the sale of a product or service. These cognitive biases are characterized by a framing of the information presented in order to influence people's decision making by dismissing their rational objectivity. Here are some examples of cognitive biases.
- The effect of fashion: the desire to be like the others.
- Groupthink: the desire to do like others.
- The freedom of spirit: the desire to differentiate oneself from others and to distinguish oneself from fashion effects.
- The authority principle: the desire to buy a product that has been recommended by a celebrity or important group (for example, toothpaste and dentists).
Marketing strategies can influence consumers' choices; so it is important to be aware of them.
With the emergence of online stores, the increase in big box stores and the decrease in small local businesses, it is becoming increasingly difficult to choose where to buy. The student must be able to compare and analyze different merchants in order to come up with criteria for good purchases.
- Is the business located near me?
- Is the quality of the service good?
- Are the products varied? Are the products in stock?
- Are the delivery times reasonable? Does the merchant offer different delivery options?
- Are the reviews about this business positive?
- What is the return policy? Does it allow returns or exchanges?
The following is a list of questions that could be used with junior students to help them learn more about good shopping choices and experiences:
- How can good service enhance the shopping experience?
- What links can be made between the increase in online shopping and different delivery options?
- What factors prevent some people from making large purchases (for example, appliances) on online shopping websites?
- What is more important to consider when making a purchase, price or quality?
- How is it possible to determine if a price is reasonable?
- Does quality matter if a product is used infrequently?
- How do you determine if an electronic device (for example, a cell phone) should be upgraded?
Knowledge: Criteria for a Good Purchase
Any purchase requires some research. When discussing a good or reasonable purchase, there are several criteria to consider when making a decision:
- Business reputation
- Choice of products
- Cost of the item
- Shipping options
- Shipping times
- Consumer evaluations
- Return policy
- Product quality
- Impact of the product, packaging and delivery on the environment