Focus on value when you exchange your cash for goods or services. Value means that the benefits you get are more than the cash you spend. This is different from buying cheap. Cheap is just a low price. It may mean that the product lasts only for a short time or does not have the benefits that you need.
* Buy before you need. When you need something urgently, you tend to buy at full price, so plan forward and buy before you the need arises. Then you have the chance to take advantage of discounts, second hand things, and others mentioned below. Don’t wait until the last minute.
* Buy at discount sales. Most stores have seasonal sales.
* Buy alternative brands: near brand, generic brands, and home brands. Home brands are products under the name of a large retailer (e.g. supermarket or departmental store) and sold on its premises. They are usually lower-priced and often of the same quality as the regular brands. Sometimes they can be substantially cheaper. Near brands are products produced by the same manufacturer that are somewhat similar in quality but differ substantially by price, e.g. Camry is much cheaper than Lexus and share many parts; Toyota produces both of them. Sony also makes Aiwa products, which it sells to a budget conscious clientele.
* Buy at alternative outlets: factory outlets and hypermarkets. Originally, factory outlets sold slightly spoilt products but now they often sell products that were overproduced. Discounts can be at up to 90%. Regular chain stores don’t give discounts for volume but hypermarkets sell bulk at lower rates. This also saves you time as you don’t have to go repeatedly.
* Buy second hand. Many things can be second hand without losing the benefits. Buy at second hand outlets, charity outlets, garage sales. Example: Second hand cars less than 2 years old are good value. Fact: Most cars lose about 20% of their value once they leave the showroom because of transaction costs (salesman’s commission, dealers charges, advertisements) Example: It is often hard to distinguish 10-year old furniture from new ones if they are of classic style. Example: I once bought an antique camera for a song at an Oxfam store.
* Buy when you travel. Know what products are cheaper in each destination. Buy duty-free but be careful: not all duty-free products are cheaper than in regular shops because airport rental can be quite high.
Example: I bought clothes and chewing gum in Korea, luggage in Singapore, and cameras in Kuala Lumpur.
* Buy mature products, not new technologies. State of the art products tend to be very expensive because there is no economy of scale, while established products have ironed out the teething problems. Example: A 15-inch LCD screen cost US$1000 in 1999, but only $250 in 2003 and $100 in 2009.