Question

As you go to your favorite retail store and you select the same-sized packaged for the price, compare the manufacturer’s brands and store brands. How much can you save by purchasing private label brands of this products? How would you compare the percentage of savings on different categories of merchandise? How did the various grocery stores selected by the class compare in terms of prices savings on their private label brands versus the national brand?

Answer 1

Answer- In India, as we go to our favorite retail store i.e easy day, there is one national brand tea which is Brooke bond Red Label. It is highly advertised and most people prefer to buy red label tea in India. And we can also see other tea i.e easy day special tea/ Bharosa Tea which is famous locally and might be considered inferior product for almost all the customers just because it is cheaper than Red label and it is made locally. People of low income groups prefer to buy store brand products and people with higher income will prefer to buy national product.

The price of the Red Label in India is INR 400 per kilogram, whereas price of store brand tea may range from INR 150 to 250 INR per kg. We can save minimum 150 INR per kg by purchasing store brand tea as per example. We can save around about 37.5 percent by purchasing store brand tea. We can also save much more by purchasing store brand biscuits or private brand biscuits.

Britania bourbon costs around 35 rupees per packet which includes 10 biscuits. On the other hand, we can get easy day yummy biscuits for just Rs 15 and that packet also includes 10 biscuits. In this we can also save more than 50 percent.

Cadbury Dairy milk chocolate is famous nationally and It's bigger pack costs around 100 Rs for one plain chocolate. On the other hand, we can see Store brand delicious chocolate which cost Rs 35 for the same chocolate. We can save around 65 percent of our money by buying delicious chocolate.

The people of higher income group will never prefer good which is not known nationally. According to them, it is low standard good. They will not think of money they have to spent on that good. The people having low incomes will definitely prefer store made brand products which is inferior good according to people of high class income group. They have limited amount of money for spending on that good.