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Money Leaks: Buying Brand Name Instead of Generic

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Grocery CartsThe easiest way to save a little money while getting almost the exact same thing is to buy a generic version of a brand name product. Whether it’s cereal or prescription drugs, the generic version is almost always cheaper and usually a close enough product that you wouldn’t be able to tell in a blind test. In the case of prescription drugs, the active ingredient is identical by law.

So why do we buy brand name goods? Sometimes we don’t think about it. Sometimes we just like it better. Those are mental hurdles we need to overcome before buying generic will be the first thought in your mind.

This is the latest edition of our Money Leaks series.

Check Where It’s Made

When I was in college, our fraternity had food delivered by Sysco. I also worked at Heinz for the summer and learned that Heinz supplied ketchup to Sysco, a fact I could confirm by looking at the manufacturing address on the back of the large cans. Ketchup product in Pittsburgh, PA, is ketchup produced by Heinz (plus you can taste the difference). If you want to convince yourself that a generic is identical to the brand name, just look at where they are manufactured and it’ll be a big hint as to who actually makes it. There aren’t two ketchup manufacturers in Pittsburgh, PA.

Check The Price

Sometimes the generic is a lot cheaper than the brand name (prescription drugs), and sometimes it’s only a few cents. Do the math and figure out whether it’s worth it for you to try the generic to see if you’ll like it better (or at least not be able to tell the difference). If you want to get even more complicated, buy one of each and mix them (don’t do this for drugs, I’m thinking cereal) if you aren’t 100% sure. In the end it’s about saving money in a way that doesn’t impact your life, this is an easy way to dip your toe in the water.

Lastly, one trick that one of my friends, who has kids, told me is that you can keep the brand name boxes of cereal and just replace the bag inside with the generic stuff. In many cases, that’s exactly what the manufacturer does anyway!

(Photo: faungg

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13 Responses to “Money Leaks: Buying Brand Name Instead of Generic”

  1. Shirley says:

    One prescription drug example is Prilosec which was first introduced to the US as “Losec” at $4.99 per pill. After it went generic (omeprezole) the cost dropped to $7.20 for 60 pills.

    • Jim says:

      Yeah, they all do this… but patent protection lets them recoup some of their R&D costs and pay for future R&D – so I’m OK with it.

  2. JP Adams says:

    A good experiment would be to profile the generic and brand names versions of 5 products.

    I would start by taking pictures of each. You could then make a side by side comparison of their price, size, ingredients, manufacturing base, and ownership.

    Dissecting their marketing techniques behind each would yield interesting insights. You could see how phrases, pictures and tone are all that account for the incremental price of the brand name version.

    It might also be fun to include a luxury good like a watch to see just how different a Rolex is from a Swatch watch.

  3. Shirley says:

    In the early 70s one of our sons was positive that only Levi brand jeans were worth having.

    He claimed other brands didn’t fit right, didn’t last, didn’t look good, and on and on… until he had to buy them himself. Suddenly other brands weren’t so bad after all. ;-)

  4. Scott says:

    One thing to note is coupons are almost always only for brand name items, not generic. So a brand name with a coupon (possibly doubled by the store) is sometimes cheaper than generic. But sometimes it’s still more expensive – like my wife’s Hellman’s mayo that she refuses to replace with generic at half the price. Pick your battles…

    • Shirley says:

      Hellmans/Best Foods mayo and Heinz Ketchup are two things I just can’t substitute. The price difference just isn’t worth the complaints from my family, even when they don’t see the label.

    • Andrea says:

      There is only one mayo…Hellmans. Period. Everything else tastes like nasty miracle whip. Vinegary or sweet. Yuck. Even professional chefs swear by hellmans as a base for many recipes.

      I’m researching here best generic for hellmans because I live in Saudi Arabia an it’s 50/50 whether I can find it any given day. Sucks. But there’s just NO substitute. Hellmans, or change recipes.

      • Shirley says:

        Andrea, As I understand it, Hellmans was introduced on the east coast and the name just didn’t fare well on the west coast. It was changed to Best Foods in the west and became an overall favorite. The two are one and the same.

        • Michael says:

          Andrea, I also live in Saudi Arabia (Al Khobar) and haven’t been able to find Hellmann’s for the past couple of months. I’m going crazy! Any luck finding some? I’m about to ask my family to ship me a huge tub.

  5. thunderthighs says:

    Good post. However, I’ve found when it comes to canned vegetables, store brands (i.e. Great Value) tend to be inferior to brand names in terms of appearance and taste.

  6. Wilma says:

    Having worked in manufacturing I can confirm that big name companies make the store and generic brands you buy cheaper. I can also tell you that they aren’t always the same. The brand name manufacturer is making the product but sometimes cheaper ingredients are substituted because the purchaser asked for the recipe change which is how the cheaper price is obtained. No not all generic brands look and or taste the same as name brand. It’s buyer be ware and try and error when buying generic. There are some I don’t care if they aren’t exactly the same but if I’m buying mayo it has to be Hellmans. There’s none other that tastes the same. I do buy the cereal in a bag. Less waste.

  7. Shirley says:

    I have to agree here with canned vegetables. The only way to know if there is a different taste in the generic brand is to try it once. If the difference in taste or appearance is only slight, but the cost is much less, I do use them in salads or casseroles. No complaints so far.


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