£1 stores can cost you more

More than 700 £1 shops have appeared on the high streets in the UK, but are you really getting value for your coin?

These shops are getting plenty of publicity: High-profile footballers like Frank Lampard have been spotted browsing £1 shop aisles; Wag Alex Gerrard wants to work in one and the Feltham branch even has an alcohol licence.

But are consumers just being mislead with inferior products and poor-quality imported brands? Are they even getting value for money?

A look at current prices shows a string of products — including Carex hand wash and Radox shower gel — are cheaper at Tescos than Poundland, thanks to discounts at the supermarket. While that's temporary reduction at Tesco, supermarkets always have something discount — and you can check offers online.

So we took 10 top everyday grocery products and compared their value (on both quality and price) in the £1 shops to the major high-street supermarkets.

[See also: 17 things you should never spend more than £1 on]

£1 shop price comparisons

The price of groceries is soaring at an alarming pace, and this may be part of what's sending consumers to discount stores. As pound stores continue to expand their selection of goods, battle lines are drawn against the high street supermarkets.

Shoppers at Poundland noted good bargains on items like washing powder and branded shampoo, but many were unconvinced about buying fresh food, produce and clothing.

We compared 10 everyday grocery items in both branded and non-branded products at Poundland against a major high street supermarket. We also compared the quantity, the branding, the sourcing and use-by dates for products at each store.

Selection

In shopping at Poundland for staple products like milk, eggs, bacon, bread and cheese, we found selection to be a problem; it was limited to only two choices of semi-skimmed and full fat two litre milk, compared with 49 varieties in the major supermarket.

In Poundland, one non-branded type of egg was sold as nine in a box compared with 21 varieties and the minimum being six in a box at the supermarket. In the supermarket aisles, there was a selection of 38 types of bacon whereas only one type was on the shelves in Poundland  - although it cost only about third of what you would pay at the supermarket.

Similarly, more than 300 types of cheese and 200 kinds of bread are on sale in the supermarket. There is one type on offer in Poundland. Sugar and tea bags come in one variety at Poundland - although the teabags are branded. On the supermarket shelves there are 44 types of sugar and more than 70 choices of teabags.

Any major supermarket offers much more variety than Poundland; however, this level of selection may be more than most people need.

[See also: 10 ways to save at the supermarket]

Branding

In addition, all the staple products in Poundland come from lesser-known UK — you won't see many of the major brands that are advertised on TV or found in the supermarket.

Use-by dates

In addition to limited variety, the use by dates were slightly shorter at Poundland, although the goods were fresh and the eggs marked with the British Lion Quality stamp, ensuring the highest standards of food safety. Because Poundland tends to put more emphasis on packaged goods, these dates are less of an issue for shoppers.

Price

Assuming that shoppers bought weekly staple items including two litres of milk, one box of eggs, bacon, bread, cheese and teabags, the total difference in price for staple items between the average supermarket and Poundland was around £3.77.

This means that if you were to swap your weekly supermarket staples for Poundland goods you would save more than £190 a year.

Household products from toilet rolls, toothpaste and washing powder were comparable, although the branded toothpaste was over twice the price in the major supermarket.

Better value?

If you aren't too picky about what you buy, Poundland can definitely provide value on grocery items. This comes at the cost of selection and branding, but for budget shoppers who are looking to buy their staples at the lowest possible price, this should not be an issue, as items at store were still of comparable quality and freshness to supermarket items.

David Coxon, trading director of Poundland said that the store "offers its customers value for just £1, on over 10,000 products", including everyday essentials and seasonal products, along with some top brands.

He also noted that Poundland would be opening at least 50 more stores in 2011 to 2012. This suggests that consumers are finding value at these stores as well.

The bottom line

Don't just assume that prices are cheaper at the pound stores. In some cases, it could pay to shop around for supermarket reductions and special offers to compare with pound store items — particularly if you are looking for a specific product or brand.

Pound stores may be a new addition to a budget-conscious shopper's arsenal, but not every item was cheaper or of comparable quality to what you would find at a supermarket, so you still need to keep your wits about you.

[See also: How to drastically reduce your food bill]

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