Group Samples Market Prices--Tags Lucky as the Lowest
The California Public Interest Research Group on Tuesday released the results of a price survey of eight supermarket chains in metropolitan Los Angeles, concluding that Lucky had the lowest overall prices and Safeway the highest on 134 most commonly used items.
Price comparisons were made by a score of volunteers at 24 stores--three from each market chain--on Oct. 20 at outlets in central Los Angeles, the San Fernando and San Gabriel valleys, and the Long Beach area, Carmen Gonzalez, consumer program director of the research group, said Tuesday.
Rating Lucky at $100 for the cost of the 134 items, the survey ranked other market chains in comparison to that base figure as: Ralphs, $102.17; Vons, $103.82; Albertsons, $103.98; Alpha Beta, $106.26; Hughes, $109.63; The Boys, $109.69, and Safeway, $110.
Noting a 10% difference between the lowest and highest priced stores, the research organization said that over a course of a year consumers who spend $100 a week for groceries at Lucky would have paid $520 more for the same items at Safeway.
While Lucky was credited with the lowest overall prices, the survey also reported that Hughes had the lowest prices for non-foods, Ralphs the lowest prices for grains and staples and Albertsons the lowest for processed foods.
While the survey results were greeted as good news by firms with the lowest prices, spokesmen for other supermarket chains challenged the size of the pricing sample and the survey’s failure to address the issue of varying product quality.
Gonzalez told reporters at the West Los Angeles headquarters of the group that the survey was the consumer organization’s first food-price study in the Los Angeles area. The group has made similar market-pricing comparisons in San Diego for a decade.
“As we have seen in San Diego, we expect an increase in competition among Los Angeles-area grocery store chains because of publicity about their pricing tendencies,” Gonzalez said.
Consumers can trust the results of the survey, Gonzalez said, because the research group has “no profit interest” in the outcome.
The California Public Interest Research Group, founded in 1972, describes itself as a nonprofit, nonpartisan association supported by contributions from more than 100,000 Californians and dedicated to researching consumer and environmental issues and monitoring corporate and government actions.
“CalPIRG has been an established benchmark for food prices in the San Diego marketplace for years,” said Dick Fredericksen, vice president of marketing for Lucky’s southern food division. “We were not aware they were conducting surveys in the L.A. Basin.
“We’re very pleased that they have substantiated our long-term price statement that Lucky stores have the best overall pricing position in the Los Angeles area. We do a lot of internal monitoring of the marketplace to be sure that we are what we say we are.”
John Rodgers, Safeway’s marketing operations manager for the chain’s southern division, challenged the research group’s price comparison.
“Price surveys are not an accurate method of properly evaluating the overall pricing structures,” Rodgers said. “Generally, the price surveys are made from a very small sampling of the 20,000 or more items purchased by our customers.
“It is impossible to compare prices accurately on meat and produce due to the major variances in quality, size and trim. The true value must be determined by considering what each customer wants to buy, especially considering special offers such as unlimited double coupons, extra-special buys, weekly specials, bonus offers, Safeway coupons. . . . No supermarket can stay in business unless it retains customers by offering what they want to buy at competitive prices.”
Al Marasca, executive vice president of marketing for Ralphs, said the chain was not aware of the price survey, but he said he was not surprised by the results. “Ralphs and Lucky generally hold the price lead day in and day out,” he said.
At Hughes, listed sixth on the survey list, Harland Polk, vice president for sales, said the supermarket organization is “very competitive on high-use” items and is “not ashamed to be price-compared with anybody in the city.”
Polk said he had never heard of the California Public Interest Research Group and wondered what items were on the list of 134 used to compare prices. “When you get into perishables, you have different types of grades,” he said. “There are pricing differences. So, I don’t know what those items are that they surveyed.”
Gonzalez declined to disclose what items were on the comparative shopping list used in the October survey. She said the list is never released because the organization wants to use it for later surveys.
Describing the methodology in general terms, Gonzalez said the shopping list items are selected to represent the contents of “the average consumer’s shopping cart, based on industry and government statistics.”
Then, she said, the items are “weighted” for the most commonly used, according to a compilation by “Progressive Grocer,” a food industry publication. For example, bread is No. 1 on the list of usage with a rating of 95.8%. In other words, 95.8% of consumers use bread.
Analyzing the data through a computer program, the consumer organization assigns bread with a 1.01 rating and proceeds through the shopping list with similar designations for each item to reach 100. The “weighted” items are then compared at competing supermarkets and processed by a computer to arrive at a comparsion of prices.
COMPARING SUPERMARKET PRICES A survey by the nonprofit California Public Interest Research Group has concluded that Lucky supermarkets have the overall lowest prices for 134 items in the Los Angeles area. By assigning Lucky or the chain with the lowest price in each category a spending figure of $100, this is how other markets compare:
Lucky Ralphs Vons Albertsons Alpha Beta Hughes Meats 100.00 111.98 112.79 114.38 109.09 123.69 Produce 100.00 102.42 105.04 106.29 114.73 117.21 Dairy 100.00 102.37 102.12 102.59 108.56 114.49 Grains/ 103.06 100.00 102.54 105.57 104.90 105.45 Staples Processed 100.07 100.79 104.17 100.00 102.36 102.72 Foods Non 102.16 100.85 101.72 100.54 103.51 100.00 Foods Overall 100.00 102.17 103.82 103.98 106.26 109.63
The Boys Safeway Meats 120.93 110.84 Produce 102.02 126.73 Dairy 109.69 101.71 Grains/ 110.08 112.06 Staples Processed 107.07 107.17 Foods Non 114.16 107.31 Foods Overall 109.69 110.00
THE SAVINGS The CalPIRG survey projected these yearly savings for Lucky shoppers over those at these chains, based on the spending of $100 a week:
Savings Store $/Yr. /Year Lucky $5,200 -- Ralphs 5,312 112 Vons 5,399 199 Albertsons 5,407 207 Alpha Beta 5,526 326 Hughes 5,700 500 The Boys 5,703 503 Safeway 5,720 520
