Grocery Prices Rise in Wake of Low-Price Gemco’s Demise

There was a time when the low prices at Gemco forced other San Diego County major supermarkets to keep their prices down, but now that the Gemco chain has folded, the others’ prices are steadily climbing, an annual food price survey has found.

The survey, conducted by the California Public Interest Research Group, also found that if a consumer is shopping at a more expensive market, double coupons may not save quite as much.

The survey noted that although price increases are occurring at all markets throughout the county, the larger chains seem to be taking advantage of the lack of competition from the now-defunct Gemco and are increasing their prices more than the smaller supermarkets.

Gemco had ranked as the least expensive supermarket of seven major stores surveyed since 1982.

Now that Gemco is gone, Food Basket and Ralphs are the two markets fighting for the position of being least expensive. But both stores have raised prices in the last year, Ralphs by 4.6% and Food Basket by 7.4%, CalPIRG officials said. The most expensive supermarket, according to the study, is still Mayfair, a spot it has kept since the study’s inception.

“In terms of any price increases, if the (food) costs us more, then we simply pass the prices along to the consumers,” Food Basket spokeswoman Judy Decker said. “But it would be terribly difficult for us to comment on the correlation between increasing our prices and Gemco’s closing without us actually seeing a list of items.”

Ralphs’ officials denied their price increases reflected Gemco’s closing.

“Our pricing position in San Diego has always been that we are the lowest priced supermarket in San Diego,” said Ralphs’ Executive Vice President Al Marasca. “Gemco’s closing doesn’t affect our strategy in any way.”

Other chains--Vons, Safeway and Mayfair--increased their prices by an average of 1.2%, the survey found. Big Bear actually cut its prices 1.8% and Alpha Beta’s prices decreased by 0.7%

CalPIRG members conducted the survey in three outlets of each of the seven chains by comparing the prices of 115 items geared, they say, to the average consumer’s grocery needs. The items surveyed were chosen based on industry statistics and included national as well as generic brands.

CalPIRG spokeswoman Judy Rader said meats that would cost a consumer $100 at the No. 1 ranked Food Basket would cost $101.62 at Ralphs, $101.64 at Big Bear, $114.35 at Vons, $116.89 at Alpha Beta, $109.45 at Safeway and $119.16 at Mayfair.

CalPIRG members also found that consumers who shop at the more expensive supermarkets because of double coupons may not actually be saving a substantial amount of money and might even be paying more.

“For example, to come out ahead at Safeway because of their double coupon policy, a consumer would have to use almost $10 worth of coupons for every $100 worth of groceries in order to pay what they would have at Food Basket or Ralphs,” Rader said.