A study conducted by the National Consumers League and Change to Win Retail Initiatives looked at the pricing behaviors of three major drugstore chains in the same four metropolitan areas. Researchers found that among Walgreens, Rite Aid, and CVS, Walgreens was five times more likely than the others to charge different prices for the same item that its competitors sell.
The study evaluated and compared the prices of 25 common brand name items, including lipstick, soap, baby wipes, and toilet paper. The consumer watchdog groups also found that Walgreens was eight times more likely to price its products 30 percent higher than CVS stores. The likelihood of consumers purchasing an item increases significantly if they walk into a Walgreens.
Not only did the retail chain matter, but the location of that chain did too. The 485 Walgreens, Rite Aid, and CVS locations that were evaluated were located in Dallas-Fort Worth, Los Angeles, New York City, and Orange County in California.
When researchers compared prices of products within the same city, they found that Claritin sold at one Walgreens in New York City’s midtown was $4.50 more expensive than the same exact Claritin product sold at a different midtown Walgreens. A bottle of eye drops sold at Walgreens in Queens is $9.99, but if you take a quick subway ride down to the Walgreens on 57th street in Manhattan, that same bottle will cost $15.49.
The findings were “a wake-up call for consumers, who don’t tend to shop around and compare within a chain,” said Sally Greenberg, executive director of National Consumers League.
It is two-and-a-half times more likely that a Walgreens will have different prices for the same item than a Rite Aid would. A single item could cost 55 percent more, completely depending upon a Walgreens store location.
According to the Chicago Tribune, Walgreens said that its sales rose 5.6 percent in August, which can be attributed to an increase in its customers’ average purchase price; however, there was a decline in the overall store traffic. This means individual customers are spending more, but less customers are purchasing from the stores.
“Our prices reflect the costs of doing business in the neighborhoods we serve as well as any nearby retail competition," Walgreens spokesman Jim Graham said. "Costs can vary from one location to another, even when they are a few blocks apart in dense urban areas, based on the store's cost of real estate, its hours of operation including whether it is open 24 hours, labor costs and the number of customers it serves each day, among other factors.”
Price adjustments, based on a store’s location or property values, is a common practice among national retail chains. Currently, there is no law restricting stores from doing so.