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And in other pricing news . . .

12/2/2011

Walmart prices are lower than dollar store competitors in two New Jersey markets, but not by much, according to a recent survey conducted by Deutsche Bank.


The firm looked at prices on 30 comparable items in Northern New Jersey markets and found that there was a minimal price differential between Dollar General, Family Dollar and Walmart. In fact, in one market, Walmart was lower than Family Dollar by 6% and lower than Dollar General by 2.6%, but in the other market closer to New York, the situation was reversed, and Dollar General was 2.5% lower than Walmart and 16% lower than Family Dollar.


“In Northern New Jersey, Walmart led both its dollar store competitors, as its overall basket of 30 items priced at $87.05, while Dollar General priced at $89.30 and Family Dollar priced at $92.25 each trailed,” according to Credit Suisse. “Interestingly, Walmart was the lowest priced on 67% of the items in this market. In the New York City metromarket, we were somewhat surprised to see Dollar General as the low-price leader, as itsbasket priced at $89.85 was lower than Walmart priced at $92.10. While not theoutright leader on price in this market, Walmart was still the lowest priced on 60%of the items in the basket, while Dollar General was lowest on 37% of the items.”


Comparing 30 items in two markets when Walmart, Dollar General and Family Dollar combined operate close to 20,000 U.S. stores may not be the most scientific of studies, but the research does provide a snapshot of the problematic situation facing Walmart as it looks to achieve price separation with key competitors in a trade channel whose growth in recent years has come at the expense of Walmart.

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