Are Walmart’s TV Commercials Truthful? by David W. Cowles
Walmart’s TV commercials state that if you spend $100 per week on groceries you can save $700 per year by shopping at Walmart. That seems like a huge savings. Can they possibly be correct? Or is their statement just advertising puffery?
Once again I’m stuck in a quagmire about something I don’t understand. I don’t understand people who try to impose their religious and moral values and other prejudices and opinions on others.
This time my perplexity was triggered by a letter from Gerry Baldwin to the editor of the Gig Harbor, Washington Peninsula Gateway newspaper. Gerry wrote:
“I remember how hard we fought to keep Walmart out of Gig Harbor some years back. It was a great threat to our quality of life and to the survival of small businesses.”
I wasn’t living in Gig Harbor when the big Walmart brouhaha took place about twelve years ago, but I wouldn’t have understood Gerry’s rampant opposition to Walmart then and I don’t understand it now.
I enjoy shopping at Walmart, and cannot comprehend how any store loaded with a wide variety of merchandise at reasonable prices can be a “great threat to our quality of life.” It seems to me to be exactly the opposite.
I’m aware of the many urban legends concerning Walmart. One alleges that Walmart’s pay scale is too low. It’s patently obvious that the trade unions are behind that charge. But it’s equally clear that Walmart employees are satisfied with their jobs and don’t want to join a union—and that should be their right.
I know for a fact that many Walmart employees would have had a hard time getting a job elsewhere because of their past work history or lack of one. But Walmart gave them a chance.
Walmart increases employment in a community and trains their personnel for advancement to better positions within the company. As Martha Stewart says, that’s a good thing.
Baldwin and others persist in stating that Walmart destroys small businesses. Is that a true statement or a fallacy? Let’s check the facts to see what kind of Gig Harbor small businesses Walmart might harm.
Almost all of the grocery business in Gig Harbor goes to the following supermarkets:
Albertsons, which is a wholly-owned subsidiary of Minnesota-based Supervalu, the nation’s number five food retailer.
Safeway, a California-based corporation that’s North America’s third largest supermarket chain.
QFC and Fred Meyer, both divisions of The Kroger Company. Kroger is the number one grocery retailer in the United States, with fiscal-year 2008 sales in excess of $70 billion.
These are the “small” businesses Baldwin wants to protect. But, at what cost to consumers?
I made a shopping list of thirty products I frequently buy. I went to Safeway, QFC, Albertsons, and Fred Meyer in Gig Harbor, and then to the Walmart Supercenter in Federal Way. I walked up and down the aisles, writing down the prices of the items on my list.
When I tallied up the totals, I was more than astounded, I was in shock.
On 22 of the 30 items, Walmart had the lowest price of all five stores.
Purchasing one each of the 30 items would have cost $91.73 at Walmart.
At Fred Meyer, the same groceries totaled $120.30. At Safeway, they added up to $126.51.
Albertsons’ bill would have been $130.77. At QFC, they came to $138.69—that’s 51% more ($46.96) than at Walmart!
I was even more flabbergasted to see the huge variation in prices on many of the items. Hunt’s tomato sauce is 66¢ per 15-ounce can at Walmart. At Safeway, the same sauce sells for $1.55—an inexplicable 235% more!
QFC had the highest prices on 14 items. Fred Meyer was highest on only one. Since QFC and Fred Meyer are subsidiaries of the same company and should have equal buying power, one would assume that their prices would be similar. But, they aren’t.
A good example is the price of pinto beans. Two pounds of pinto beans costs $2.49 at Fred Meyer, At QFC, the beans cost $4.39. Walmart charges only $1.22. I don’t understand that at all. Pinto beans are quite fungible.
In previous years, all supermarkets assiduously shopped their competition in order to assure that their prices stayed competitive. Apparently, they no longer do so. Perhaps today’s store management doesn’t care if they’re competitive or not.
Perhaps they believe they can scam and con their customers with “club prices” and other gimmicks that supposedly save customers money but really don’t, and that no one will be the wiser. And, perhaps they’re right. Shoppers can be quite gullible.
When there’s a club program or items purportedly on sale, in many instances the “regular” price is inflated in order to show customers a larger supposed savings—even though the “special” price may still be higher than the item sells for elsewhere.
For example, Safeway’s “regular” price for one pound of Ritz crackers is $4.29. Their club price is $3.79—which is still $1.29 (52%) higher than Walmart’s regular price of $2.50.
Also at Safeway, the “regular” price for a package of Johnsonville Bratwurst is $5.99. Their club price of $3.99 (they want you to believe that you’re saving $2.00) is still 73¢ more than Walmart’s price of $3.26. Where's the savings?
It’s the bottom line that tells the true story. The devil is in the details.
Walmart’s TV commercials are incorrect. They greatly understate the amount of money that can be saved by shopping at their Supercenter—at least for residents of Gig Harbor, Washington, and, I suspect, in every other part of our nation.
According to my survey, if you spend $100 per week for groceries at Walmart, buying those same items at the other supermarkets will cost you—not $700 more, as Walmart says on their commercials—but (at least, in Gig Harbor) a shocking $1,619 to $2,661 more per year!
There’s one thing I do understand. Baldwin and the other anti-Walmart apologists who “fought to keep Walmart out of Gig Harbor” have cost the citizens of Gig Harbor a small fortune—in the neighborhood of $20 million each year. That’s not small potatoes.
I certainly don’t understand what Baldwin and the other people who fought Walmart could have been thinking, or what personal axes they had to grind. I don’t know who Gerry Baldwin is or what he does, but I suspect that he is either employed by a union or is a card-carrying member of a union.
I sure wish we had a Walmart Supercenter in Gig Harbor. Until we do, I’ll keep my grocery shopping in Gig Harbor to a bare minimum and make the trek to Walmart a couple of times each month. Even after paying for gasoline and the $2.75 bridge toll, I’ll still save a whole lot of money.
And to Gerry Baldwin and others of his ilk, I want to say: Do me a favor—please don’t do me any more favors. No one will force you to shop at Walmart or anywhere else. Please don’t prevent me from doing so.
Don’t take Walmart’s word that they will save you money. Don't take my word, either. Make a list of the groceries you buy for your family, and check out the prices for yourself. I think you'll be as shocked as I was to find out how much the big grocery chains are ripping people off.
For details of my comparison shopping price survey, go to page two.