Does buying anything that your heart says is exactly what you term as financial freedom? If yes then I fall in the same category as you are! I believe that’s the world that we all would love to live in. But who will create such an environment for all of us? Of course it has to be we/us/I.
Spending pattern analysis is the most effective way of gaining this freedom. It’s a way of saying “I will buy what I want to, but will also analyze what, where and how often aspects of my buying”.
For example how often you go to your apartment grocery shop/your nearest departmental store to get your grocery needs fulfilled. Did you ever wonder whether this retail outlet is selling products at a much higher price? You can do a simple comparison with the large super market chains in your city and your nearest/local ‘kirana’ shop. These super markets would be able to give you the same products (or may be fresher in some cases) at much lesser price – this is possible as they buy the same products in bulk and pass on the price benefit to the consumers directly, and in the process eliminate the middle agencies. Many bigger retail chains actually buy directly from the farmers and even pay a better price for their produce and still are able to provide a much lesser price to the items on sale. As you can make out this is beneficial for both the farmers as well as the consumers.
On that note – I would like to ask – have you ever bothered to check how often you went to Shop A as compared to shop B for the same things (could be restaurants, gift shops, departmental stores etc.) and then analyzed how much you have spent at these places, how often do you visit such places or any other insights? Well, this is where a web based application can help you and guess what; this can be done with just by a few clicks.
I would love to cite my personal experience here. I was never into analysis of such boring things of life but then once I did it with my grocery and dinning categories. I must say it was quite a revelation – for the past 6 months my dinning as well as grocery expenses were making a steep upwards move. That’s strange isn’t it? If am eating out more often, then my grocery bill should actually come down and same should be true the other way. But strange as it may sound that was not happening. Thanks to my habit of keeping all the bills of my purchases at one place for atleast a month, I was able to find the cause. As I was eating out more often (the cause for the increasing dinning bills) cooking at home reduced hence I started buying more and more of ‘junk food’ for home. As you all know this category of food is much expensive as compared to the regular items that you may buy for home cooked food. Hence the grocery bills also kept increasing. This insight would not have been got without an analysis.
Well, it was just an example of how analysis of your own habits can make larger differences in life. More insights to follow…
Having seen my father keep a regular 'hisaab diary' of all expenses, analysing purchasing patterns has come naturally to me. I am happy to say that thanks to this, I have been able to spend wisely. When Toor Dal prices were Rs.95 per kg at most shops across the city, I bought it for Rs.80 from the local shop. Infact even now at Rs.72, it is cheaper than all other super markets.
What you mentioned here is 'Contract Farming' where the farmer cultivates for and on behalf of big business establishments and forwards the produce at a pre-determined price. In return, the contracted farmers are offered high prices against their farm produce.However, it is not as rosy as it sounds with farmers being controlled completely by the biggies. In worst but frequent cases companies many a times deny to purchase the harvested crops citing poor quality as the reason. This leaves farmers with a huge produce which they are forced to sell at other centers at a much lower prices than the the market rates. Monopolising the cropping pattern with lack of diversification of crops mandatory for retaining soil fertility is another of its many evils. Punjab in India, is the worst affected state which had taken to contract farming on a mass scale.
well, this is interesting. I was not aware of the same, thank you for sharing this info.