Pricing study pits Walmart's store brand offerings against national brands

A pricing study from Raymond James and Associates went inside the Walmart shopping basket over a two-year span, comparing a basket of 50 private brand grocery items against 50 national brand products that can be bought at the retailer to measure the value of its private brands. 

The publication Talking Business & Politics reported on the study that looked specifically at Walmart’s Great Value, Sam’s Choice and Equate brands. A Store Brands article recently reported that Great Value is a $27 billion global brand.

Of the 50 items in the shopper basket, beer, waffles and ground beef didn’t have a private label option so a branded item was put in the basket. Produce and meat were measured out by the pound.

The basking breakdown over the two years continually showed the private brand basket offered a savings gap of around 30% versus the national brand basket. For example, in January, the basket (not counting health and beauty products) added up to $97.50 compared to $141.47 for the national brand basket. When including HBA products, the savings gap increased to around 34% in the month of January. 

The study also compared Walmart’s basket against baskets found at Target and on Amazong. The retailer had lower prices per basket against both, demonstrating a savings gap against Target as high as 12% and around 4% versus Amazon. 

“We believe this portion of the survey is important, as more retailers invest further into private labels to compete against Amazon. In addition, for Walmart private labels [price and quality] will be increasingly more important as hard discounters like Aldi continue to expand their U.S. footprint,” said Bobby Griffin, a research analyst at Raymond James and author of the report, in the TB&P article.

Read the full article here.