Consumers are cutting their grocery spending across the country, but who spends the least and how do they do it?
Who Pays Less on Groceries
Residents of Midwestern states are likely paying less than those in Los Angeles and New York, according to a study by market research firm IBISWorld.
An average basket of brand-name groceries costs $112.20 in Chicago and $125.15 in Los Angeles, IBISWorld says.
Even better, savings are especially significant for those who buy cheaper store brands, the firm says. The average store-brand buyer in Chicago spends about $92.04, while store brand shoppers in Los Angeles pay $110.64.
Yet organic groceries in Chicago, for example, are notably more expensive than those in Los Angeles.
"…By taking greater control of the entire supply chain, [large supermarkets] have been able to minimize the cost structure for store brands versus competing products," said George Van Horn, senior analyst with IBISWorld in a press release.
“The organic grocery cart is a staggering 37.6% more expensive than a basket primarily filled with store branded products,” the firm adds.
Cheaper Groceries in Los Angeles?
"Organic markets still look to own the supply chain, but they operate on a much smaller scale, resulting in markups," Van Horn said.
Yet in Los Angeles, a grocery store bill for organic foods is about $137.52, while in Chicago, the same groceries cost $142.95.
This disparity is likely because California is a large producer of U.S. crops and Los Angeles is close to Mexico, where much of our produce comes from.
"Despite the high price of organic products and the recession restricting budgets, the organic food market is still growing by 4% in 2009," adds Van Horn. Offerings and sales of store brand organic groceries is on the rise as well.
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