Where You Live Determines How Much Your Eggs Cost at Kroger

Across Louisville's Kroger stores, uniform signs pop out from aisles in bright yellow bursts to proclaim: "Hi! I'm your low price."

What's not uniform: The numbers posted on the signs — even when they're advertising the exact same products.

A dozen eggs in Germantown: 59 cents. 

In Portland: 95 cents.

In Prospect: $1.99

To shoppers who travel between grocery stores within the same company, the differences in costs can come as a surprise. But industry insiders say varying price points are just normal business.

Competition dictates price for grocery companies, which operate on slim profit margins, as little as a penny on the dollar. If individual stores don't have anyone to contend with in their market space, they're able to bump up their rates.

"When there's less competition, whether it's a wealthy area or a poor area, they have to take advantage," said Phil Lempert, a grocery analyst who provides insights on the industry through his website Supermarket Guru.

For the past month, the Courier Journal has monitored grocery prices on five staple items across more than 20 Kroger and Walmart stores in Louisville and Southern Indiana, checking both online and in person to see how costs vary between different neighborhoods.

The review found that prices for those staple items are consistently higher at markets that serve as an area's primary grocery store option.

On Sept. 19, for instance, customers who picked up a gallon of milk, a dozen eggs, a bag of sugar, a pound of butter and a handful of bananas at the Kroger in Portland, 520 N. 35th St., could expect to pay $8 for their cart.

Meanwhile, shoppers at the Kroger on Buechel Bypass in Bashford Manor — located near a Walmart, Target and Costco — could expect to pay $6.85 for the same items.

In Prospect in Jefferson County's east end, where Kroger has no competition from other big-box grocery stores, customers faced the highest prices at $10 for the five products.

At Walmart stores around that time, the lowest price on the five items ($5.32) could be found at a store near E.P. Tom Sawyer State Park — an east end area that's also home to Meijer, Target and Kroger stores. 

The highest price for a Walmart store: $7.54 at the New Albany location in Southern Indiana, which is within a mile of the nearest supermarket.

HOW DO GROCERY STORES SET PRICES?

Kroger representative Erin Grant said a local division office is responsible for setting prices across its Louisville area stores.

"We have an entire team dedicated to overseeing that we are pricing accurately," Grant said by email. She declined to discuss the process further or elaborate on why prices vary between locations. 

Kroger is the largest supermarket chain in Louisville, by far, with 26 stores scattered across the community compared to Walmart's 12. 

In June, theCincinnati-based company launched its "Refresh" low-price campaign at 116 stores across Kentucky, Illinois and Indiana, promising to offer discounts on frequently bought products like eggs, bread, chicken, cheese and butter, according to a news release from the company.

Eggs and milk have become highly competitive products in the current grocery climate, experts say, with companies offering extremely deep discounts on each in hopes of getting customers into their stores.

"The milk and egg pricing deal has become very, very competitive lately, and that's why we are seeing such disparity across the market," said Steve Kute, whose family owns Save-A-Lot stores in the Portland and Iroquois neighborhoods.

The discount chain has headquarters near St. Louis, and Kute said employees there conduct weekly price checks to see how each store's prices compare to its competitors. The employees then set prices based on what nearby stores are doing.

On a recent visit to two Save-A-Lot stores, located in Park Hill and Schnitzelburg, the Courier Journal found that prices on milk and eggs were comparable to those at nearby Kroger stores — at $0.99 for a gallon of milk and $0.65 to $0.89 for a dozen eggs.

LOCAL PRICES BEAT NATIONAL AVERAGE

Despite the variations, all the prices across Louisville's Kroger, Walmart and Save-A-Lot stores were still drastically lower than the national average for each of the five items. 

According to the Bureau of Labor Statistics, the average prices for a gallon of milk and a dozen eggs, for example, are $2.87 and $1.62, respectively. 

The local stores' competitive prices appeal to Frances McAtee, who said she's more concerned by the steep rates charged at corner stores near her home in Park Hill.

The west Louisville neighborhood has a poverty rate of 47 percent, and McAtee said convenience stores in the area often charge at least double what the closest grocery stores do for such items as cheese and bread.

Neighborhood corner stores don't have the same purchasing power as supermarket chains, which often leads to an increase in price, experts say.

"Cheese is $4 there and I can get it at Kroger for $1.99," said McAtee, who catches a bus to the Kroger on 35th Street, about 4 miles from her neighborhood, instead of paying the higher prices.

"It's worth the $1.75 (bus fare) to go over to Kroger. If I have to make two trips, I make two trips. I do what I got to do."

For people curious about what they're paying and where they might find the best deals, analyst Lempert suggests checking prices online and in print advertisements before going to the store.

He said customers should also keep their receipts to see how prices change on their next trip.

"If you want to save money, get online. If you don't have a computer, go to the library. Compare prices at the stores and figure out the cost of transportation that would factor into it," Lempert said. "You might be able to save money by going two miles."

WHAT PRICE ARE YOU PAYING?

Since August, the Courier Journal has intermittently reviewed prices on five frequently bought grocery items across more than 20 Kroger and Walmart stores in Louisville and Southern Indiana to see how costs vary between neighborhoods.

The items: a gallon of milk, a dozen large eggs, a pound of butter, a 4-pound bag of sugar and a handful of bananas.

A reporter checked prices on the companies' websites by changing the preferred shopping location and followed up by visiting several stores in person.

On multiple occasions, the prices at the stores fell below the national average for the items, but they varied greatly between stores within the same companies.

National average from the Bureau of Labor Statistics, August 2018:

• Gallon of whole milk — $2.87
• Dozen eggs — $1.62
• 4 pounds sugar — $2.52
• 1 pound bananas — $0.57
• 1 pound butter — $4.09
• Total — $11.67

A price check on Sept. 24 found that 13 Kroger stores had the same total for the five items: $6.85.

The totals varied at the following stores.

• $7.02 — 4501 Outer Loop
• $7.46 — 2219 Holiday Manor Court and 291 N. Hubbards Lane
• $7.56 — 4211 S. Third St.
• $8.02 — 520 N. 35th St. and 2710 W. Broadway
• $8.16 — 305 E. Lewis and Clark Parkway, Clarksville, Indiana and 200 New Albany Plaza, New Albany, Indiana
• $8.96 — 2200 Brownsboro Road
• $9.96 — 5929 Timber Ridge Drive, Prospect

At Walmart, none of the prices on the reviewed stores were the same.

• $5.32 — 3706 Diann Marie Road
• $5.63 — 12981 Shelbyville Road, Middletown
• $5.67 — 7101 Cedar Springs Blvd.
• $5.69 — 2020 Bashford Manor Lane
• $5.78 — 4840 Outer Loop
• $6.08 — 175 Outer Loop
• $6.39 — 11901 Standiford Plaza Drive
• $6.89 — 143 Thierman Lane, St. Matthews
• $7.54 — 2910 Grant Line Road, New Albany

TAKE OUR SURVEY

How do you get food in your neighborhood?

The Courier Journal wants to know how access to food varies across our community as part of a project produced through the University of Southern California Center for Health Journalism's National Fellowship.

Please help us better understand your individual shopping habits by filling out a survey at courier-journal.com. Information you share will not be published without your permission. If you have any questions, email bloosemore@courier-journal.com or call 502-582-4646.

[This story was originally published by Courier Journal.]

Remote video URL