Methodology for Cost Comparison: How to Compare Brands and Prices

Advice For Seniors

Weighing your options can save you money on large or small purchases.

No matter if you are purchasing something online or through a brick-and-mortar store, you can get the most for your money by knowing how to compare brands and prices effectively. While cost comparison can be handy for major purchases, you can also use it for items with a smaller price tag. Here’s what you need to know about quickly and thoroughly comparing brands and prices before your next purchase.

How to Do a Cost Comparison

Taking time to complete a cost comparison before you pull out your wallet or debit card information is well worth the effort. Once you perfect your cost comparison technique, you’ll find that it becomes a habit and that you end up spending less money on products you have researched.

The main steps for completing an effective cost comparison are:

  1. Find the product you want
  2. Find at least 3 competitors and the similar product they offer
  3. List the prices of each product as well as the features
  4. Take into consideration any additional fees that might come with each option
  5. Determine if the costs are similar or if one option is significantly less expensive
  6. Make your choice

Of course, you don’t have to choose a product based on price alone. There are other factors to consider when making a decision. For example, you don’t want to purchase a product that costs less but that will stop working in a few months. You can make the price just one aspect of your product comparison strategy.

Reviews | Social Proof

Head online to search for reviews in order to make your best decision.

Another way to determine which product to purchase is to ask others who might have used it. Reviews are easily accessible today, whether through word-of-mouth or through online boards. When reading or listening to reviews, be sure to take any outliers less seriously than what the majority of the reviews are talking about.

Here are a few ways you can solicit reviews from people or view them online:

  • Ask family members and friends about their experience with the product or service
  • Ask the company you are researching for a list of references you can contact
  • View reviews on the company’s Facebook page, Google page, or other review boards like Yelp 
  • Look at any follow-up action taken by the company in response to a negative review; sometimes following up and making it right can go a long way in demonstrating customer service values

You can interact further with in-person or online reviews by asking questions that give more insight into the experience of the reviewer.

Comparing Fees

Comparing fees is an important piece of your comparison and decision-making strategy. However, it’s not just the initial price tag that you should be comparing. Instead, you should take into consideration all costs that could be associated with the product or service. Here are a few things to keep in mind as you are determining the overall cost of competing products:

  • Initial purchase price
  • Monthly service fees
  • Installation fees
  • Sale prices or other incentives 
  • Added fees for additional services or equipment
  • Cancellation fees

If you are purchasing something that relies on a monthly service, it’s important to take a look at the cancellation process as well. See if the contract specifies any cancellation charges or if there is a lengthy process to go through in order to cancel.

What to Watch For

When you are choosing a product or service, you want it to be reasonably priced. You also want it to be reliable and to last for a long time. Finally, you want your overall experience with the company to be pleasant.

Here is a list of things to look out for that could be red flags that point to a potential problem in the future:

  • A company that is difficult to reach or slow to respond
  • Online reviews that talk about poor customer service
  • Negative reviews about the quality of the product or service
  • Clients leaving after only a few months
  • High product return rate
  • Sales representatives who are pushy or demand that you make a decision right away without taking the time to think about it.

Tax Implications: Is It Deductible?

Another way you can make a good decision about your next purchase is to determine if the product or service could be eligible for tax deductions. Potential items that could be tax-deductible might include:

  • Office equipment
  • Some medical or dental expenses
  • Some home or appliance purchases
  • Health insurance premiums

If you aren’t sure if your product or service is tax deductible, it never hurts to ask before you purchase. Call your CPA before the purchase or save the receipt and bring it to your accountant during your tax preparation to see if it could be deducted.

Financial Assistance: Can It Be Subsidized

Similarly, you might be able to save some money if the product or service you are eyeing can be subsidized. A quick internet search for “does Medicare pay for…” can render you reliable information to determine if the healthcare product you are looking at is covered by Medicare. You can also look to offset costs for healthcare related purchases by checking:

  • Your health insurance
  • Veterans benefits
  • Medicare or Medicaid coverage
  • Long-term care insurance
  • Local grants for senior specific purchase

How Products Rate vs. Competition

You might find that you still aren’t quite sure how your preferred product or service compares to the competition. In these cases, you can find that a buyer’s guide can be quite helpful. Mostly found online, buyer’s guides are well-researched and feature the benefits and drawbacks to the main competitors who sell a specific product or service.

Characteristics of the Best Choice

Finally, when you are ready to make your decision, keep these characteristics in mind to ensure you are getting the best quality for your money:

  • Positive reviews, both online and off
  • Do the purchase costs or monthly fees fit into your budget
  • The product or service is stable
  • The company is reliable and not going anywhere
  • The company is dedicated to a positive customer experience

With these tips an advice, you’ll be making your best purchase decisions in no time. Good luck with your next comparison shopping adventure!