Store war, few spoils of battle

6/15/2003

DESPITE THE Toledo area's highly competitive grocery scene, a Blade survey last week of a marketbasket of food staples found little price difference at the region's major supermarkets.

That's not to say that consumers won't benefit by shopping around, but an informal price survey of 15 basic grocery items, all of them included in the federal government's Consumer Price Index, found just $3.31 separated the store with highest total, Food Town, from that with the lowest, Kroger.

Further, every store had other brands or larger sizes of the product with either lower prices or better value.

``Those basic staples, those are the items that stores and people watch the most, so those are the ones they are going to provide the best prices on,'' said Jim Sautter, owner of Sautter's Five-Star Markets, an area independent grocer.

``It's the items that people don't buy frequently that have seen a real increase in prices locally and vary widely from store to store.''

Shoppers who closely watch specials and prices can flit from store to store to reap significant savings, greater than were available before metro Toledo's grocery competition heated up three years ago, Mr. Sautter said.

Still, he added, “I believe that you should find a store where you feel comfortable, because in the end you'll pay about the same.''

The Blade survey last week seemed to support his contention, at least at the local stores of national and regional grocery chains. Price checks were done at Kroger, the area's No. 1 in market share; Food Town, which has been No. 2 but is in the process of selling or closing its stores; Meijer, No. 3; Farmer Jack, No. 4; and Giant Eagle, which had just a 2 percent share with a single store, but this month opened a second area store.

Farmer Jack and Giant Eagle are new to the market, and Kroger has added local stores in the past three years, ratcheting up the competition.

Eunida and Lee Liddell, of Toledo, realize that prices at the area's grocery chains are similar, so they shop at the Kroger on Monroe Street in Toledo because it's close to their home.

``The things you want are always on special, but that's how they get you in the stores,'' Mrs. Liddell said. ``I know how it works. You get one thing on sale here and everything else goes up.

``You spend a lot of gas driving around to the other places and you don't save that much.''

Toledoan Anna Maher also has learned it's better to stick to a place near her home than to chase after bargains. She too shops Kroger on Monroe because it's closer and generally has the merchandise she wants at the prices she wants.

The items in the survey were picked to provide a cross-section of food from the 43 items included in the national consumer price index computation done by the U.S. Department of Labor. Specific brands and sizes were chosen in advance to ensure comparable prices.

The survey found that some food staples were discounted heavily at some of the chain stores, but otherwise were priced similarly. The discounts often were available if customers had a store card, which can be obtained free by filling out a form requesting name and address.

Items priced at Kroger had the lowest total mainly because eight of the 15 selected products were discounted last week for holders of the store card. The total was highest at Food Town, which has done away with its store card. Meijer is the only other major chain in town without a store card.

Area grocers that offer the cards encourage customer loyalty by monitoring sales of discounted items and continuing to offer specials on the popular products.

``Those loss leaders get people in the door,” Mr. Sautter said. “That's generally the game plan for most stores: get people in the door and make a profit on the non-traditional items.''

Supermarkets make up for the discounted items by increasing prices for specialty produce or cuts of meats on which price comparisons are difficult or on non-food items such as beauty care products, industry experts say.

That can mean that prices are lower on a number of items, giving shoppers the impression of overall savings, when prices on hundreds of other products may have risen, more than offsetting the savings. As a result, shoppers may not be saving on their overall grocery bills if they shop only at a single store, experts say.

``With more competition, you would expect prices to fall,” said Walt Churchill, Jr., former chairman of Churchill's Super Markets in Toledo. “But competition can create more expenses, and companies are going to pass those expense along somehow.

“The other thing about driving around cherry-picking on specials is you're going to be exposed to more products and specials, and you'll probably end up buying more darn product that you don't need. That's the way they plan it.''

Kroger spokesman Leonard Terranova said shelf prices aren't all that shoppers should consider.

“There're other factors that come into play - double coupons, unadvertised specials, customer service,” he said.

Generally, grocery prices locally do not appear to have dropped significantly from three years ago, when the current supermarket wars began.

For example, Cub Foods, now departed, offered a weekly special on a gallon of milk and a two-liter bottle of Coca-Cola for 99 cents and 89 cents, respectively, three years ago. In last week's Blade survey, the lowest prices on those items were $1.99 and 88 cents, respectively.

In another example, Food Town offered a special on Kellogg's Corn Flakes of $1.99 and on ground chuck for 99 cents a pound three years ago, but last week the lowest prices at a local store of a national or regional chain were $1.99 for the cereal and $1.69 a pound for the beef.

Clearly, prices for some food items nationally have climbed. For example, a Blade survey 10 years ago found a gallon of milk priced at $1.28 in the five chains that dominated the market. Last week, Meijer offered milk for $1.99 a gallon, but prices at the other chains started at $2.50.

Large eggs were 89 cents a dozen in 1993 but were 95 cents to $1.39 last week at area stores. A five-pound bag of potatoes was no higher than $1.89 a decade ago, but that price was the minimum last week. And Campbell's Chicken Noodle soup was 48 cents a can in 1993 but was 60 cents to $1.09 at area stores last week.