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Why grocery prices can differ by neighborhood

Posted: 10:56 PM, May 17, 2016
Updated: 2016-05-18 12:09:45Z

Kerri Simmons is a busy mom of three, and every penny counts when she shops for groceries.

"We're a family of five on one income, so we try to make our dollars stretch," she said.

So she couldn't believe her eyes when she found the price of Tyson chicken breasts much higher at one grocery store, compared to another just a few miles away.

"The price of a pound of chicken was $5.99 a pound," she said. "And then I stopped at the next store, and it was $3.99 a pound. And I thought that was a huge difference for the exact same brand and exact same product."

She could understand if it were competing stores, she says, but it was the same grocery chain.

“The same day, it was a 50 percent increase in price at one store," she said.

She's not the only viewer to complain to us about finding different prices in different neighborhoods.

Charlotte Wilson told us the same thing two years ago: finding grapes for $1.76 a pound at one Wal-Mart but just 92 cents a pound later that day at another Wal-Mart just a few miles away.

"I think consumers should be aware that they have such a large discrepancy in prices," she said.

So could you be paying more, simply because of where you live? And could some neighborhoods actually have higher-priced groceries than others?

We Compare Stores and Neighborhoods

To find out, we compared prices at 16 grocery stores, representing four different chains, plus Walmart.

We chose nine popular grocery items many families buy every week:

  • Tyson boneless chicken breasts
  • Oreo cookies
  • Ritz crackers
  • Prego spaghetti sauce
  • Oscar Mayer bacon
  • DiGiorno self-rising pizza
  • Tropicana orange juice
  • Bananas
  • A dozen large eggs

We were careful to compare exact sizes. Once the data was in, we crunched the numbers and found some surprising results.

The Results Are In

We found prices to be fairly uniform from store to store in the same chain, even in areas where there was no close competition..

It turns out downtown and inner city residents are paying no more at their grocery store than people living in the newer suburbs, which is good news for people who don't have cars.

Our big grocery chain had only one price discrepancy among all five stores we checked: a box of DiGiornio pizza was $5.99 at one but $4.99 at the other four stores.

Walmart had several more store-to-store differences, specifically with Tyson boneless chicken breasts.

The chicken prices ranged from $2.26 a pound, to $3.83. One Walmart  also had cheaper bananas, 38 cents a pound as opposed to 52 cents at their other stores.

Wal-Mart spokesman John Forrest Ales told us that prices should be the same from store to store in each market, but said that store managers have the discretion to lower prices to match competitors, or to clear out perishables, which may have been the case here.

The Bottom Line

Most major grocery chains tend to have the same prices from store to store, which makes sense for advertising circular reasons.

Our consumer investigation found no discrimination against shoppers in an area with few stores, or downtown areas.

However, we did spot slightly lower prices in one area that had 5 grocery stores, including a Walmart, Target, and Sam's Club all within a mile.

Bananas, orange juice, and chicken,were all a bit cheaper there, which could be attributable to the hyper-competition in that area.

Managers who have the authority to lower prices to match competitors may be doing just that It wasn’t enough of a price difference to justify a 20-minute drive, to save $3 on your weekly basket. 

But the bottom line is that if you live hear an area that has multiple grocery stores, plus a Walmart, chances are your prices will be lower.

As always, don’t waste your money.

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Don't Waste Your Money is a registered trademark of the E.W. Scripps Co.

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