Value shops in Singapore: How are the things so cheap?

I’m sure everyone is no stranger to the signs with “FIRE SALE ! EVERYTHING MUST GO!”

Shops like ValuDollar/Valu$ or ABC shop can be seen all across the island, be it in the residential neighbourhoods or inside shopping centres.

I, for one, love to go on a shopping spree in these shops and just pig out on the snacks there.

Especially when certain brands like Kusuka cassava chips can only be found there and not in local supermarkets . (Do give it a try, I highly recommend it!)

While it’s easy to get carried away buying things there, I’m sure many of you have wondered, “how are value shop things so cheap?”

Even amidst the Covid-19 Pandemic, with restaurants and shops closing here and there, how are value shops surviving when they’re selling things at low prices?

Let’s find out how!

TL;DR: How value shops in Singapore earn money

Strong messages to create a sense of urgency

Even before you enter the store, you can see giant banners with signs telling you that there’s a big sale and everything must go.

What these signs do is that they will prey on the kiasu mentality that Singaporeans have to not want to lose out.

Especially when you see signs telling you that “We Lose Money You Save!”, the slashed prices, and the huge discount percentages, you are compelled to buy more from them.

These messages create a sense of urgency that draws us in to buy more.

Scaling up the savings with economies of scale

As you can see from the products’ packaging, the products in these value shops are not local products.

One of the ways that these value shops can save on their supply costs is by buying items in bulk from foreign countries.

The large volume of products being imported help them save the individual cost of each product through economies of scale.

Furthermore, by expanding their suppliers to multiple various different countries across the globe, value shops can save even more on the costs of getting their products.

Same brands, but actually different products

Have you ever noticed that the chips from Doritos in value shops look different from those you get from grocery stores ?

Besides Doritos, other brands that you see, such as Chipsmore, Milo, or Tim Tam, can also be found inside these value shops.

However, when you actually taste these products, there are some differences compared to those from supermarkets out there.

Value shops could have imported their products from countries such as Indonesia, Malaysia or the Philippines, where the prices are lower.

However, the manufacturing method for these products might be different, causing the taste of familiar products to feel a bit “off”.

Getting their supplies via the grey market

But what about typically expensive products, such as feminine hygiene products or cookies and chocolates from the US or UK?

This is where Grey Market Retailing comes in. Wholesalers which supply to local supermarkets or grocery stores usually have surplus stocks.

Therefore, they will turn to grey market dealers to help them clear these stocks at massively discounted prices, and this is one of the places where value shops get their supplies from.

Since they are getting products at such low prices, they can compete with local stores using these low prices as their selling point.

ALSO READ: How do budget shops such as ValuDollar earn money if everything they sell is so cheap?

Cutting it close with expiry dates

Ever seen how Cold Storage sells its hams at highly discounted prices? Or perhaps bakeries selling their bread at low prices close to the end of the day?

That’s because these products cannot be kept for too long or are near their expiry dates.

One of the ways that value shops can get their products cheap is by buying products that have minor defects in their packaging or are nearing expiry dates which would usually be thrown away.

In doing so, they can charge their products at a lower price, and shoppers will tend to overlook these details in light of these huge savings.

Hacks to make the most out of value shops

Although it’s a fact that value shops offer the lowest prices no other shops can beat.

Sometimes you might feel cheated when you see that some of the products provide less quantity than what it seems or when your favourite snacks taste oddly different.

Although it is expected for the prices, it can still be a frustrating experience. Hence, it’s crucial to set your expectations when buying things from these shops.

To help you with that, here’s a list of hacks to help you make the most out of these shops:

1. Check the expiry dates before buying

As mentioned earlier, value shops sometimes get their products cheap by buying supplies nearing their expiry date.

So if you’re thinking of keeping that bag of chocolates or chips for a few months, it’s important to check their expiry dates before buying them.

Don’t let “ Netflix and chill” become “ Netflix and puke”!

2. Buy products you don’t use often

Value shops sell all sorts of things, including batteries, shaving blades , or stationery.

Because of their prices, you can generally assume that the quality of these products would be lacking as well.

Therefore, it might be wiser to invest in something priced higher but reasonably good to ensure you don’t have to constantly replace your items.

Talk about “penny wise, pound foolish”, amirite?

3. Hunt for exclusive brands in value shops

Value shops sell products from brands that you don’t usually see in other shops, such as supermarkets.

Think of brands like Kusuka or Oishi. Since these brands are from foreign countries like Indonesia or the Philippines, we don’t always see them in shops.

Unlike in the case of the brands we know and love, like Doritos or Chipsmore, there is no higher quality alternative out there.

Hence, they’re one of the best things to buy at the value shop since you won’t be disappointed by any difference in quality for those products.

4. Buy refills, not new bottles

One of the biggest frustrations I get when you buy a bottle of hand soap is when the bottle is only half full.

Constantly replacing these products is not cost-efficient. Furthermore, you’re not helping the environment with the amount of plastic waste you generate.

Therefore, it’ll be a wiser decision to just buy the refills directly and reuse the empty bottle you already have!

This article was first published in Seedly.