Blood-Sucking Leeches

Another parasite.

Interested in my thoughts on Groupon? You need to read this instead.

Earlier this year, I wrote about one of the many parasitic organizations that earn revenues solely by selling services provided by other people. I call them the parasites of the tour industry because they live off our hard work and require us to compete against ourselves.

The BillToday I was contacted by a similar organization. This one, which I refuse to publicize with a company name or link, gets businesses to offer special deals on goods and services on the organization’s Web site. They sell the deal and then take a “commission for the use of the platform.”

The commission? 40%!

Of course, I didn’t get that information from the caller. She assured me that the service was free. She said she’d send me a link so I could check it out. She said she looked forward to having a conversation with me about it. I wondered: aren’t we having a conversation now?

I had to visit the site, poke around, and discover the commission fine print. Then I called her back. She was surprised — she hadn’t given me her phone number. But I have caller ID, so it wasn’t tough to call back. I asked point blank what the rate was and she said they do a 60/40 split. I’d get 60%.

Let’s do the math. Today’s special offer is 50% off on rock climbing for a Phoenix-area rock climbing “gym.” The price: $8. So the original price must be $16, right? But what are the rock climbing people getting? $4.80 on something they’d normally get $16 for. That’s a 70% discount. Those folks must be pretty desperate for business.

I don’t even need to do the math to know that I can’t work with these people. My margins are far less than 40%. That means that even without a special discount for buyers, I’d lose money on every sale just by paying the commission. I told her not to bother calling me again; I wasn’t interested.

The next time you find a Web site that offers smoking deals on goods and services, take a minute to consider the struggling small business owner on the other end. When you take advantage of one of these offers, you’re not buying directly from the business owner. You’re buying from a middle man who’s taking a piece of the pie. 40% is a huge piece. What’s that business owner going to wind up with?

The crumbs left behind by a blood-sucking leech.

Fraud Alert: East Coast Mobile Style

Check your credit card bills!

Just a quick note to alert readers to a scam that’s evidently been around for a while.

In reviewing my credit card charges for the week I was gone, I found a charge for $2.56 from “#eastcoastmobilestyle.” The name was not familiar to me, so I called the phone number on the charge record, which appeared in the memo field of Quicken’s register when I downloaded my transactions: 912-289-0124. I got a recording with a female voice that sounded Asian. She said they could not provide support and that I should e-mail a support address. I left a message and kept digging, trying to find out what I’d supposedly bought from this company.

I wound up on a Web site called 800Notes where people evidently log the phone numbers of suspicious calls. There was a page dedicated to this number that mentioned East Coast Mobile. There were three pages of comments. In each case, the commenter had received a phone call from this company and a charge for $2.56, $4.56, or $6.56 had appeared on their credit card bill. I checked my new phone’s call log and did not see any calls from that number. However, I’d purchased my phone just the day before and had used the same credit card to make the purchase.

This certainly appears to be a scam. They get your credit card info and process a tiny charge. Most people would ignore a charge like that — after all, it could be for a ring tone or some other minor cellphone related service. But other people — like me, I guess — know who they buy from. I did not buy anything from this company.

I called the fraud department at my credit card company. They reversed the charge and cancelled that credit card account. I’ll get a new credit card later this week.

My advice to everyone reading this: always check your credit card bills for unknown charges. Follow up on the ones you don’t recognize — no matter how large or small they are. If this company places tiny charges like this on 100,000 cards, they can make a quarter of a million dollars in no time. They can also repeat the process for other charges — including larger ones — or sell your credit card information to scammers.

Please spread the word about this to the folks you know.

June 2, 2009 Update: In just a month, this has become one of the most popular posts on this blog. It consistently gets more than 50 hits per day. This is telling me that the fraud is extremely widespread.

Imagine that only 1% of the people who are fraudulently charged by East Coast Mobile Style find their way to this blog post. That means 5000 or more people per day are being charged. Even if the fee is the low number of $2.56, that’s well over $10,000 of fraudulent charges per day!

PLEASE spread the word about this fraud to the people you know. We need to stop credit card fraud any way we can. Always check every item on your credit card bill, no matter how small. I know it’s a pain in the butt to cancel a credit card, but if your has been compromised, that’s the only solution.

Good luck!

Buy on Sale

Don’t sacrifice when you can shop smart and save.

Wow, does that tag like look like something written up by a marketing guy for a discount store or what? But that’s not what this is all about. It’s about really shopping smart and taking advantage of sales to buy the things you want and need.

Where I’m Coming From

First, I need to make something clear: I’m not a shopper. I don’t read newspaper ads, looking for the best deals on this and that. I don’t spend hours every week hopping from store to store to save a few bucks. I don’t clip coupons. I don’t have the time or patience for any of that.

And I should also point out that Mike and I are a family of two with just two pets. No kids, no huge meals. Although we might spend as much on food as a family of four, it’s because we like good food. We tend to lean toward quality and the things we really like rather than quantity and settling for second best.

We’re not broke — we’re both still gainfully employed in this f’ed up economy. But like many smart people out there, we’ve seen the writing on the wall. Who knows what could come next? Who knows whether Mike’s company can stay afloat in these troubled times? Or whether people will still be interested in treating themselves to helicopter tours. I’ve already seen a sharp drop in book sales — the real source of my income.

That said, it really irks me to pay more than I have to for the grocery items I like or need. I’m talking about everyday staples, like paper products (toilet paper, paper towels, tissues), coffee, milk, butter, etc.

What I’ve been doing for years now is buying the items I need in quantity when they’re on sale or when I find them somewhere else at a really good price. Here are some examples.

Coffee

Eight O'Clock CoffeeI like Eight O’Clock Coffee. It’s an Arabica bean with a light roast. It’s more robust than Dunkin’ Donuts coffee, which I liked before I left New Jersey and could no longer get here in Arizona. (It’s now available in Arizona; I tried it again and was disappointed.) But it’s mellower than Starbucks or any of the other boutique coffee brands — although I’ll take Starbucks Breakfast Blend in a pinch. I buy it as whole beans and grind it at home as part of my coffee-making ritual. Nothing like a good cup of coffee first thing in the morning, huh?

My local supermarket sells a 12-0z bag (whatever happened to a “pound” of coffee?) of Eight O’Clock coffee beans for $7.59. I think that’s outrageous. But every once in a while, it goes on sale for $4.99. That’s more like it. I buy enough to last until the next sale, saving about $2.60/bag or 21¢ per ounce. Not bad. But recently, they’ve been having these really kick butt sales on the coffee, selling it for $3.89 per bag. That’s about half price. Each time I find it at that price, I buy eight or ten bags.

One of the nice things about coffee is that it’s sold in the kind of airtight containers designed to keep it fresh. While coffee doesn’t have an unlimited shelf life, if stored properly, it should stay fresh for at least half a year. So why not buy it at that low price and stock up? Just make sure you rotate your stock so you’re always using up the older stuff before the new.

And while I’m talking about coffee, it also makes sense t talk about coffee filters. I make my coffee in a Black and Decker single cup coffee maker. I’m the only coffee drinker and I like my coffee brewed just before I drink it. I don’t like coffee that’s been sitting on a pot on a burner for more than maybe 5 minutes. After that, it starts getting stale and I really can’t drink it.

Gold Cone FilterMy coffee maker comes with one of those “gold” filters. It’s a washable thing that’s supposedly better for brewing coffee because it helps the oils of the beans meld together or some such bull. Whatever. What I find is that using the reusable filter guarantees bitter bean residue at the bottom of my cup. I’ll stick to paper filters. The coffee maker takes a #2 cone filter. I don’t buy Melita brand or unbleached or any such nonsense. I buy the cheapest ones I can find — they do the job perfect well. My supermarket sells them in packs of 50 or 100. At my rate of 2+ cups per day, that’s enough filters for one or two months. But over the past summer, I discovered that Wal-Mart sells off-brand paper filters like the ones I use in packs of 250 for less than what I pay for 100 at my local supermarket. So when I go to Wal-Mart — which isn’t very often, thank heaven — I buy two or three packs. Stock up and save.

Oh, and if you’re a coffee aficionado reading this and want to “educate” me about brewing and drinking coffee, save it for another blog. I’m tired of people telling me about how my coffee should be. I make it the way I like it, thank you. My point is not how I brew or drink coffee. It’s how I buy what I like and stock up when it’s at a good price.

Other Products

My husband and I don’t go grocery shopping. We go to the store when we need something and buy what we need, along with a few other things. You’ll never see us in the supermarket with a cart full of groceries. We’re usually able to check out on the 15-items-or-less line. It’s been that way for years, since the days in New Jersey when we’d walk to our local grocery store/meat market after work each day and buy dinner right before we cooked it.

You might think that this kind of shopping is less conducive to saving money. It isn’t really — at least not for us. (Again, remember that we don’t have a family to feed.) We’re still walking many of the aisles of the supermarket. And we’re still keeping an eye out for bargains. When butter goes on sale, we buy two or three pounds and freeze what we don’t immediately need. The same goes (without the freezer) for canned items such as chicken broth and soups. (We don’t eat much canned food.) Pasta, pasta sauce, salad dressing — we buy it all on sale before we need it. We pay close attention to the “Best by” dates and don’t buy anything that we don’t think we’ll use before it “expires.”

What we don’t do is buy things we don’t like or won’t need just because it’s on sale. Mike’s a good example — often, I can buy a gallon of milk for just a bit more than I’d pay for a quart. But there’s no way I’ll use a gallon of milk before it goes bad and I’m not interested in freezing it (as some people do). I also don’t believe in throwing food away. If you buy something you don’t like or don’t use, you’re throwing your money away.

The Lure of Costco and Sam’s Club

Ever notice that if you go into a Costco or Sam’s Club you’re lucky to get out of there without spending at least $200? Ever wonder about that? Ever wonder if you’re really saving money?

I’ve been avoiding these places unless I know for sure that there’s something there I need that’s cheaper there than anywhere else. I firmly believe that I can get better prices on an item in my local supermarket when it’s on sale than I can in a Costco. Best of all, I don’t have to buy a case of it.

Costco NutsMy husband — well, he’s still sucked in. He buys cases of canned corn and canned chicken broth. He buys huge plastic jars of nuts and garlic powder and peppercorns. He buys buffet plates full of smoked salmon and styrofoam trays of flank steaks. He buys a lot of junk we don’t need. He freezes things that are better not frozen. We eventually do eat or use most of what he buys, but we also throw some of it out. I don’t like that.

My thoughts on these warehouse stores is that unless you’re shopping for a large family or group — or a restaurant — you probably shouldn’t be shopping in there. Sure, the strawberries are a great price per pound, but do you really think you can eat 10 lbs of them before they go bad? What are you going to do with 12 giant fresh-baked muffins? Got room in your freezer for that 10-lb bag of flash-frozen chicken breast? Are you even going to get them home before they start defrosting? And where are you going to store those 24 rolls of toilet paper and eight boxes of Kleenex? And you do realize that even canned food doesn’t have an infinite shelf life, right?

Shop with a Calculator

Buying bigger isn’t always cheaper. Don’t get conned into buying the jumbo size just because you’re too lazy to do the math.

I know this sounds dorky, but if you have trouble comparing prices of items because they’re sold in different quantities, use a calculator. 12 ounces for $2.39 is cheaper than 20 ounces for $5.29. Most supermarkets will help you by posting the per ounce (or other unit) price for each item on the shelf.

Going back to my coffee example, my supermarket also sells Eight O’Clock coffee in a larger bag. I think it’s 2 pounds. But a comparison of the per ounce price clearly shows which bag is a better deal; when the small bags are on sale, they’re almost always cheaper per ounce.

A calculator and a cheat sheet with supermarket prices would certainly help me prove my theory about Costco. But that brings me back to my original point: I’m not a shopper. I just buy the things I want or need in reasonable quantity when I find them at a good price.

The Joys of Online Shopping

Why visit stores?

I have gotten to the point where I do about 75% of my non-grocery shopping online. I’m willing to bet that a good portion of the folks who read this are in the same situation. The rest of you might wonder why.

The Shipping Cost Argument

Most people use this as their argument against online shopping: if you shop in a store, you don’t pay shipping.

Okay, this is true. But I still have to get to the store. That takes time and costs money for fuel.

While I’m more concerned with the value of my time than the cost of fuel to drive to a store that has what I need, I won’t deny that I probably would have to drive at least 80 miles roundtrip from my Wickenburg home to find the item I’m looking for.

Let’s do the math here.

First, my time. Suppose I have to drive 80 miles round trip to get to a store that might have what I want to buy. Suppose I can get to the store in about an hour and that it takes me a half hour to find what I want to buy and pay for it. Then another hour to get home. That’s 2-1/2 hours. But what if the store that I thought had what I wanted didn’t have it? Then I have to go to another store, which may or may not be nearby. Let’s estimate 30 minutes for each store I visit. Now let’s estimate 2 stores per item I need to buy. So if I have to buy something as simple as a pair of jeans, I might be spending about 3 hours to get to the store, find them in my size and color, buy them, and get home. In 3 hours, I can write a how-to article for publication on a Web site that pays me several hundred dollars per article. So I’m potentially losing out on several hundred dollars of income.

Okay, so suppose I wasn’t planning on doing anything else that day. For the sake of argument, let’s assume my time is worthless.

But let’s look at the fuel costs. Suppose I drive that in my Honda, which gets about 20-25 miles per gallon highway. There’s some highway driving and some nasty “city” driving in terrible traffic where I usually shop. To make the math easier, let’s assume 20 miles per gallon. That’s 4 gallons for the 80 miles. Fuel prices for premium (which this little car takes) have ranged from $1.50 to $5.00 per gallon over the past year. We’ll use today’s price, which is about $2 per gallon. That’s $8 in fuel alone.

How much is the shipping cost for that pair of jeans?

It’s Not Secure

What? Get with the program. If you shop smart online, your transaction is secure.

In fact, it’s probably more secure than handing your credit card to a waiter in a restaurant where it’s all too easy to copy down credit card information before running a charge for your meal. Or reciting it over the phone, in a place where it could be overheard, or to a company that may or may not have honest employees or good intentions.

What’s risky is entering credit card information in unsecured forms online. Look for the lock icon on the edge of your browser window to ensure that a form is secure. You can also look at the URL; it should start with https (note the all-important “s”). Another thing that’s risky is putting your credit card information in an e-mail message. There’s no reason to do it, so don’t.

It Doesn’t Support the Local Economy

Well, that’s certainly true. But neither does shopping at the mall. Or at Wal-Mart.

And neither does hiring staff in India or China or Pakistan to provide telephone support or make products.

Let’s not go there, okay?

Today’s Purchase

Simply said, online shopping is fast, convenient, and affordable. Here’s an example.

Chef PantsI just bought 3 pairs of the “chef” style baggy pants I like to wear. (And no, I didn’t buy them with this crazy pattern — although you have to admit they look pretty funky.) As I was buying them online, my husband pointed out that he knows a place in Phoenix that sells “those kind of pants.” But do they sell the brand I’m wearing right now? The brand that seems to be cut perfectly for my middle-aged body and relatively long legs? And how much do they sell for there? These are all unknowns. There’s a chance that I could track down the store he knows and spend 30 minutes in there only to find out that they don’t have what I want. That my time wasted.

I found an online retailer that sold the pants I wanted by doing a Google search for a brand name. I immediately saw a store I’d bought from in the past, as well as a bunch of other online stores. Within about 10 minutes, I confirmed that the store I’d used before had the colors I was interested in at the best price. (You want to buy your own pair? The pants are from Five Star Fundamentals and the online store is AllHeartsChefs. These a great pants.) The entire shop-and-buy transaction took 15 minutes of my time as I sat at the kitchen table, enjoying my morning coffee.

Shipping on these three pairs of pants was a hefty $12.50. That’s a lot more than the $8 of fuel that I use up on a Wickenburg to Peoria shopping trip. But guess what? There was no sales tax added to my purchase. That saved me about $4.50. Oddly enough, when you add the cost of fuel to the sales tax I saved, it results in exactly $12.50 for this purchase. So the net savings was just my time.

And I’ll continue to argue that my time is of value to me.

The Death of Brick and Mortar Retailers

Online shopping is going to put a lot of brick and mortar retailers out of business. It’s sad, but is it such a bad thing? Don’t you think we have enough strip malls in this country? Aren’t you sick of seeing “big box” stores popping up all over the place, causing traffic jams during the day and blotting out the night sky with their parking lot lights?

Yes, there’s a loss of jobs. Or maybe it’s just a shift of jobs from malls to warehouses.

The benefits — as far as being green go — are real. People argue that when you buy online, the item has to be shipped to you and the shipper has a carbon footprint. That’s true, but don’t I have a carbon footprint when I drive my Honda down to Peoria and back to buy a single pair of jeans? The UPS guy, in contrast, is bringing goods for dozens — if not hundreds — of Wickenburg residents every time he comes to down. He’s doing the driving for all of us. And the more online shopping we do, the more driving we don’t have to do — while his driving remains almost the same.

This is the same argument the railroads have been using lately to say why shipping freight via rail is more green than shipping via truck. They’re already making the trip; adding more items doesn’t substantially increase the carbon footprint.

Personally, I’d like to see malls go away. I’d like to see downtowns revitalized. I’d love to be able to go to downtown Wickenburg and shop for things like clothes and shoes and books and music. I’d love to sit at an outdoor coffee shop with friends in my own town, with shopping bags at our feet while we discuss the bargains we’ve found. None of that kind of shopping is available in my town or anywhere near it.

Just as malls are killing downtown shopping, online retailers are killing malls.

And the way I see it, I’ve wasted enough time and money shopping. When I want to buy, I’ll buy it online.

What do you think? Use the Comments link or form to share your thoughts.

Cheaper Charts from NACO

I find a less expensive source for aeronautical charts.

For the past few years, I’ve been using iPilot.com as a source for my aeronautical charts. I subscribe to the charts I want, providing a credit card number up front. When the new chart is available, it’s automatically shipped to me and my card is charged for the amount due. The service is very good and very reliable. I always get the new charts before the old charts expire. The prices are slightly discounted and, for regular charts, shipping is free.

Shipping is not free, however, for the Airport/Facilities Directory (A/FD) — that green book with information about airports. Although I seldom refer to this book, I’m required by the FAA to have a current one covering my area of flight on board my aircraft for every Part 135 flight — which is pretty much every flight I do. The books cost $4.45 each. Shipping, however, is another $4.80. That brings the total to $9.35.

Every 56 days.

It’s a tough nut to swallow. After all, it’s a book I rarely refer to which rarely changes. Yet I’m required to buy it every 56 days. It’s an operating cost — one of the smaller costs that make owning and operating a helicopter charter business so costly. And yes, that might not seem like much, but when you have 20-40 of these stupid little expenses, they really add up.

FAA LogoI’ve ordered charts from NACO — that’s the National Aeronautical Charting Office of the Federal Aviation Administration (FAA) in the past. Although they sell charts at list price, they don’t charge for shipping. They also don’t charge for shipping non-chart items like the A/FD or similarly bulky Terminal Procedures Publications (TPPs).

But, as I discovered today, they do discount items when you buy subscriptions. A subscription for an A/FD is 7 editions — basically a full year. A subscription for a Sectional chart is 4 editions — basically two full years.

So, for example, I can subscribe to 7 editions of the Southwest A/FD for a total of $27.02. That’s $3.86 each. Shipping is included. So I save about $5.49 per 56-day cycle. Or $38.43/year.

There is a downside to this. Two of them, really:

  • You must pay for an entire subscription up front. There are no refunds. So rather than pay each time an item is shipped, it’s all paid for in advance.
  • You must renew the subscription manually when it expires. NACO will send you a reminder via e-mail 30 days in advance so you don’t forget, but it is slightly less convenient.

Today I switched my A/FD subscription from iPilot.com to NACO’s online ordering service. I’m keeping my charts with iPilot.com, at least for now. I’ll wait and see how well NACO handles the subscription before I make any more changes. I wouldn’t be saving that much money on a chart subscription and I rather like the convenience of iPilot’s system.

One more thing I should mention…you can download pages from the A/FD or TPP publications for free on an as-needed basis. Although this would not satisfy my requirements for the A/FD, it’s certainly handy for folks needing airport diagrams and instrument approaches. Most of us don’t need them all, right?

If you haven’t checked out the NACO site, I recommend doing so. There’s a lot of information there. Sure, it’s not a pretty site, but you know it’s accurate because it is the source.