Truth About Wal-Mart's/ Big Bazar Prices

A customer shops along the fruits department in a Sam's Club store, a division of Wal-Mart Stores, in Bentonville

Are you a Wal-Mart shopper? Many people who shop for groceries and clothing at the big retail chain don’t realize that the “Save Money, Live Better” slogan isn’t completely true. In fact, some analysts argue that Wal-Mart prices on common household goods may not be the best deal when it comes to package size.

"Wal-Mart appears to be driving its customer base to spend more dollars through purchasing larger package sizes, while it may not be offering the perceived reward of more actual savings on a per unit or per ounce basis," said Mark Montagna, an analyst with AvondalePartners. "After adjusting for product sizes, we found Dollar General prices at parity with Wal-Mart."

Back in May, one of the analysts bought 102 items each from Wal-Mart and Dollar General. Who won the price war? It turns out that the Dollar General products ended up costing $308.20, while Wal-Mart’s items rang up slightly higher at $308.41 when the price was adjusted for ounces or units. To further exacerbate the findings, a gallon of milk from Dollar General was 42 percent cheaper than Wal-Mart milk. Cantaloupe was also 25 percent cheaper.

However, this doesn’t mean that the dollar store is the clear winner. For example, Cocoa Pebbles and Chips Ahoy are more expensive at Dollar General than at Wal-Mart. The analyst also mentioned that Wal-Mart has a much wider selection of products—a factor that is beneficial to customers who don’t want to make multiple trips to different stores. Essentially, stores are not making things easier for the average customer. It’s surprisingly difficult to find legitimately good deals.

Thanks to the recession, customers could really use a lifeline these days. Core inflation is at its highest in three years, while economic growth is screeching to a halt. Consumers are really losing some income—wages are staying the same while prices are still increasing.

Wal-Mart’s tries to back up its “Save Money, Live Better” slogan on their website. They cite numerous studies that claim that their prices are cheaper, and that the effect of Wal-Mart’s massive expansion has brought prices down at other retail stores too. Is this really true? Wal-Mart has definitely been making gains in their share price, but now that their price model has been copied by other retail corporate giants, Wal-Mart might have to discover more ways to earn and retain customer loyalty.