As competition for Washington's food dollar intensifies, shoppers are discovering that price differences between supermarkets are a matter of no small potatoes.
A survey of 150 items at 18 of the area's chains and independent stores revealed a 27.8 percent gap in the price of national brands between the least expensive market, Basics, and the most expensive, Shelton's.
Prices were checked once in May and once in June by Washington Consumer's Checkbook. The nonprofit organization, supported by foundations and memberships, compares the prices of area goods and services.
As usual in such surveys, the prices of the two leaders, Giant and Safeway, were alike as peas in a pod or "too close to distinguish," the researchers found. (The stores have issued money-back guarantees if shoppers can find lower prices elsewhere.) giant stores located near basics stores had slightly lower prices on national brands than did Safeway stores located near Basics. But prices at regular Safeway stores showed up a fraction of percent lower than those at regular Giants. Compared to Grand Union, the chain with the highest prices among the four largest markets, prices at regular Safeway stores were 8 percent lower and at Giants not near the Basics were 7 percent lower.
Basics, the cream of the area's no-frills food emporia, will save a shopper spending $100 a week at Giant or Safeway about $450 a year; $800, if the shopper trades at A&P or regular Grand Union stores, the watchdog group noted. (Basics is owned by Grand Union.) The survey says that Safeway's no-frills Food Box stores in the District charge 6 percent more than regular Safeway outlets. As for variety, both Basics and Food Barn have a good selection, although not as complete as in the big chain stores.
According to govenment figures released Tuesday, the grocery prices in the area plummeted by 5.1 percent during April and May. Consumers' Checkbook noticed a 2.3 percent decline between May 1 and June 11. Only part of that decrease was caused by dips in wholesale prices; the bulk of it was caused by an old-fashioned price war, Consumers' Checkbook President Robert Krughoff said.
The no-frills concept began in the metropolitan area in early 1980. At first the difference between Basics' prices and those of the largest conventional markets was 20 percent. The consumer report notes that there was a "good deal of evidence that Washington area supermarkets were running on bigger margins than stores in other parts of the country." Then the regular stores began cutting their prices.
Giant's profits fell 94.7 percent in the last quarter after it began discounting products in the hope of getting a larger share of the market. But Safeway and Giant cannnot both expect to increase their volume. If one does manage it, Consumers' Checkbook predicts it may then pay less attention to cost control.
The report concludes that if prices are to stay down, "Some major changes in operating philosophy are needed."