Buzzword: Megashed

What it means. In this country we call them big-box stores, but across the pond, massive retail centers with 100,000-square-foot interiors are known as megasheds. Like the places it describes, this Britishism is not intended to be quaint. It entered the lexicon largely through protests against the largest retailer in the United Kingdom, Tesco, which has been criticized for its Walmart-esque approach to doing business.

Why the buzz? Love ’em or hate ’em, megasheds are here to stay. The top five retailers worldwide all carry big-box distinction: Walmart tops the list, followed by Carrefour (France), the Home Depot (North America), Tesco, and Metro AG (Germany). Even the global economic meltdown hasn't slowed growth at some retail Goliaths. Indeed, while year-over-year U.S. retail-chain store sales for November declined 2.7 percent (the biggest drop in 35 years), Walmart actually posted record gains, according to the International Council of Shopping Centers. (See how some of America’s biggest retailers fared in our report on the best appliance stores.)

“Consumers are now focused on necessity,” says Ellen Davis, vice president of the National Retail Federation. “They're buying what they need in order to make it through the downturn.” That's why some chains known for deep discounts are faring better during a recession than department stores, supermarkets, and other retailers.

Walmart has benefited from the current recession. “If you go back three or four years, we were telling the other side of the story, asking ourselves, ‘Why is Walmart so weak?’” says Michael Niemira, chief economist at ICSC. The answer, he explains, is that Walmart's attempt to attract more upscale consumers failed miserably. Its return to a value-based model “has helped propel Walmart through the year and the holiday season,” says Niemira.

Until the economy rebounds, Walmart and the megasheds like it will be bargain-hunting beehives. But you still need to be savvy to find the best values:

Be careful use credit cards. Paying cash provides a much-needed reality check, especially when you're lured by all the heavily discounted merchandise. If you do use credit cards, always pay them off on time.

Stick to your shopping list. An informal poll on our Web site found that one in two visitors to Costco and Sam's Club spent more than they had intended. “When most people go into a store to buy something on sale, they often come out with 10 other things that weren't on sale,” explains Davis. The best way to avoid this trap is to stick to a shopping list.

Buy reliable products. As noted in our Buzzword on reliability, low prices shouldn't come before reliability. Use our brand repair histories, available for many major product categories, to learn which manufacturers have the best record over time.

Look for the right deals. It’s easy to think that everything sold at megasheds is a bargain. But the best deals are revolving, just like at any other retailer. “You need to be able to differentiate between a good deal and great deal,” says Davis. Use sites like PriceGrabber and BizRate to verify you’re getting the best price.

Share the perishables. If you shop at warehouse clubs, share large purchases of dairy products, frozen foods, and fresh meats among friends and family.—Daniel DiClerico

Essential information: Read Tightwad Tod on our Money blog for updates on the best deals this holiday season. And use our Home Improvement Guide interactive to find advice on buying appliances, tools and power equipment, and building materials.

Comments

[John Harris]

One of the problems with stores like the now defunct Circuit City...Most were located next the so called big box stores and if you miss your exit off the freeway to go a Circuit City or Best buy etc.....There will be another at the next exit.