|Kix-ing Over the Price Barrier
They target the price people will pay, and if people will pay four dollars, they're going to price it at four bucks.
-Dr. John R. Burton, University of Utah
Now, don't get me wrong. I'm not a cheapskate; no Scrooge am I. But by birth I'm a New Englander, frugal and aware of prices.
I'm also a product of the Great Depression, a time when pennies counted, and to this day I check prices. No complaints from this quarter on the cost of any item if it appears reasonable, but it more than annoys me to be ripped off.
I don't try to cut bargains, even with an item as big as an automobile. I don't like to "negotiate" big-ticket items. I simply inform the salesman I'd like his best price, no dickering, and if the bottom line is what I think fair, I'll buy. If not, I'll go to another dealership with the same introductory statement.
But there are items that offer no price alternatives - unless they are on sale. One either buys or doesn't buy. Who's going to spend the time and waste the fuel driving from market to market to save pennies, quarters or even a bit more on breakfast cereal?
That's the topic for this week: breakfast cereal. If you start the day with oats, corn, wheat and such inundated in milk - maybe with berries or other fruit on top - you, too, suspect we're being ripped off. And there's not much we can do about it. The alternatives: buy it, switch to something else not so healthy, or skip breakfast.
Getting My Kix
The shocker came over the weekend when the stock of Kix - corn balls filled with air - ran out in the Burton kitchen on the shores of Stoney Creek. Headed to Lauer's, a Riviera Beach supermarket, to pick up a Sunday Capital and Washington Post, I decided to replenish the Kix supply.
It had finally happened. For months, I had wondered when a big box of Kix or some of the other popular cereals would break the $4 barrier. And there on the shelves was a 13-ounce box of it priced at $4.03.
That's more than four bucks for less than a pound of mixed corn, whole grain oats and oat bran, with a touch of sugar added - all puffed up in balls filled with plain old air of the kind we can breathe for nothing. I checked out the aisle and noticed many other comparable cereals had new prices in the same range.
I purchased a box and headed home, fuming. As I said, I don't like to be ripped off, and this was a rip-off. I wasn't blaming Lauer's. General Mills, a big cereal maker that has been around far longer than I have, was the target of my discontent.
First thing I did when I got back in the kitchen was call my brother John in Salt Lake City where he is a professor at the University of Utah. Within his bailiwick is consumer affairs. He wasn't surprised.
He informed me there was probably 25 cents in agricultural products within the box, maybe a tad more seeing I purchased the jumbo box, and he told me what I already knew. Nothing I could do about it. General Mills, like everyone else, wants maximum profit. There are stockholders to please.
Then he spoke the words at the beginning of this column. As long as people are willing to pay the price, that's what the price will be for crispy corn puffs. Or for anything else from a can of sardines to a you-name-it.
"Eating cereal is getting as expensive as bacon and eggs, don't they realize that?" I griped. To which he responded, "Yeah, but these days people are in a hurry in the morning. No time for food preparation.
"So you pay the price. And as long as you do, that's what it will be - or even higher. Stop buying, and the price will come down, but that won't happen. Consumers are different today."
It's a Conspiracy
I got the message. I'm not one to switch from cereals in the am. Much as I prefer eggs and home fries alongside ham, bacon or sausage, I had my bypass surgery a dozen years ago, and one is more than enough. I'm also diabetic, another consideration that makes cereal with skim milk and diet sugar my appropriate choice to start the day.
I'm not big on cereal, and diet sugar doesn't add the zest. But it's healthful, and I presume it has the vitamins, calories and whatever else is required to keep this old body functioning. So to rouse my taste buds - and help me forget about bacon and eggs, waffles, wheatcakes, creamed chipped beef over toast - I mix several different cereals. Maybe I add a few peanuts or some fruit to make breakfast palatable.
"So how can they justify the prices of cereal today?" I asked brother John. He was born at the tail end of the Depression and can't remember when a box of Kellogg's Corn Flakes sold for 12 cents. But like me, he abhors being ripped off and has made his vocation trying to help people avoid the same.
"They really can't," he responded. "But they talk about packaging, promotional and advertising costs, research and development."
"Wait a minute," said I. "Kix has been around since I was young. Where's the research and development? It's the same Kix, tastes the same, looks the same, but it doesn't cost the same."
"You got it," said John. "You're paying for a brand. The big companies have bought each other out, and now there's just General Mills, Kellogg's and Post left." He laments no longer seeing the old familiar Nabisco logo on a box of the shredded wheat my mother used to call "brush brooms" when we were kids. We didn't get it too often because it was three cents more a box.
"The now-Post Shredded Wheat is in a different colored box, so I guess I'm paying for packaging design," said I.
"Right," answered John, who cautioned me not to put my hope in cereals of generic or otherwise less costly independent brands, such as plain packaged off-beat choices in puffed rice or wheat that cost half as much if you're lucky enough to find them tucked away on the bottom shelf of a super market.
"They can't compete," added John. "Cereal makers, like about everyone else in the supermarket business, actually buy space at big prices on the shelves. They rent the space. Independent brands can't compete. And if you decide to skip high-priced cereals for the quickie alternatives that pop into a toaster oven, see who they're made by. Usually the same big three."
You Can't Win
"Nothing I can do about it?" asked I.
"Wait for sales," said John. "But sometimes after the sales, you'll notice the prices have gone up again, or there's less product in a box at the same price. You can't win."
The farmers can't win, either. They get none of the action. Like us, they're on the sidelines.
So, dear readers, understand my frustration. You probably share it. We pay the price to eat healthy - but as we do we're annoyed enough that our blood pressure skyrockets. So we're back in a physical condition box that calls for more prescriptions, which brings in the greedy big drug companies, which is the topic for another time. Things ain't nice here at the bottom of the totem pole.