California Dad Says He's Cracked the Code to Smart Shopping

PHOTO: Kyle James is the founder of the coupon website Rather-Be-Shopping.com.

Kyle James, the founder of the coupon website Rather-Be-Shopping.com says he's cracked the code that can help predict if something you're buying might be marked down later.

James, 40, in Redding, California, says many stores have an internal pricing system that shows if a price has already been marked down, or if it will be marked down again. He said current and former employees have helped him develop knowledge of these systems.

For example, James says knowing about these pricing systems can help customers save money if followed correctly. He suggests you make significant purchases, such as electronics and patio furniture, when the price is at clearance or final markdown.

Here are some retailers' pricing systems, according to James.

1. Sears

Prices ending in $0.99: you’ll be paying full retail price.

Prices ending in $0.97: the price of a discontinued item on clearance. The price could go down even further.

Prices ending in $0.88: the final markdown price.

Brian Hanover, a spokesman for Sears, declined to comment when contacted by ABCNews.com, saying he cannot comment about the company's pricing strategies.

Read More: 3 E-Tools to Make Shopping Easier and Cheaper

2. Target

Prices ending in $0.99: full price.

The prices of some items may end in 8 or 4, such as $7.88 or $7.24, which typically indicates that the items are on clearance.

More importantly, James said, consumers should look at the top corner of price tags, which sometimes reveal the markdown percentage of the item from the original price. For example, if it says “50,” it’s 50 percent off the original price. An item will “typically” stay at the current markdown percentage for 10-14 days before getting marked down further, he said.

He said the number will be either 15, 30, 50, 75, or 90 and is the markdown percentage of that item from the original price.

Evan Lapiska, a spokesman for Target, said the company uses a number of different factors to determine an item's price and would not confirm that markdown percentages are noted on some tags.

"The ending digit of a clearance price is determined by several factors, including the original retail price and the applied percentage discount. It is not possible to determine the final markdown or timing of the price change from the item’s current price," Lapiska said.

3. JCPenney

Prices ending in $0.00: full price.

Prices ending in $0.99: clearance price.

Prices ending in $0.97: clearance or “reduced” items.

Kate Coultas, a spokeswoman for JCPenney, said she could not comment about pricing for competitive reasons, but she corrected James' pricing system, noting that prices ending in $0.99 are both clearance and sale prices, which still provide a "great deal."

James said the "real key" is to look for products ending in $0.97 as those items are further reduced clearance items.

James also lists his observations on the pricing systems of other retailers such as Costco and Sam's Club on his blog.

Costco did not respond to a request for comment.

A spokeswoman for Sam's Club, which is owned by Walmart, said she could not share the company's pricing strategies.

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