Well, the way I understood this, before you return Melicamp (the chicken) to him you can only buy his stuff once(the second time you talk to him he won't sell you anything). After you do so, you can buy his stuff like in a normal shop: as often as you want. I'm not sure what happens if Melicamp dies while being transformed, I always reloaded.
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Kazara
Waitress at Cloudy's Cafe