It's happened to all of us. You head into the drugstore to quickly pick up some aspirin or toothpaste and you walk out the door carrying a bag stuffed with impulse items -- even groceries, as more and more drugstores stock everything from ice cream to beer.

Not surprisingly, those impulse buys will cost you. A new report from Consumer World found that average drugstore prices were more than 36% higher than the average supermarket prices. The site looked at a group of 25 items and compared their costs at three drugstores and three supermarkets in the Boston suburb of Somerville, Mass. The most expensive supermarket, Shaw's (SVU), at $83.56, was still a 17% better deal than the least expensive drugstore, CVS (CVS), at $98.12.

A can of Maxwell House coffee was $6.99 at Walgreens (WAG), but only $3.49 at Market Basket, a small regional supermarket chain in New England. A pint of the much-loved Ben & Jerry's ice cream was $6.29 at CVS, but only $3.99 at Stop & Shop.

"The price variation on some items took my breath away," says Edgar Dworsky, founder of Consumer World.

The drugstores didn't even stack up well in the non-food items: Scott toilet tissue, Tide, Finish (for dishwashers), Windex and Formula 409. In most cases, those items were a dollar or two more in drugstores than in some supermarkets.

Rite Aid had the distinction of having the most expensive basket of items at $107.46, while CVS was the least expensive at $98.12.

Why Drugstores Are Going Gaga Over Groceries

Pharmacies are just trying to take advantage of all those folks coming in to get their prescriptions filled. The goal of selling groceries is to increase store profitability, says Steven Halper, managing director of equity research with Stifel Nicolaus.
When you buy groceries, where do you find the best prices?
Supermarkets3377 (55.0%)
Warehouse clubs1855 (30.2%)
Drugstores42 (0.7%)
Mom-and-pop stores103 (1.7%)
I can't find bargains anywhere650 (10.6%)
1 (0.0%)
117 (1.9%)


"CVS has done a very good job maintaining a profitable mix of its front store sales," says Halper. "Groceries such as beer and wine have very good margins. Walgreens has just introduced beer and wine, and we believe it has helped store profitability."

Each retail pharmacy operator has its own pricing strategy. "Walgreens probably has better pricing on groceries as it wants to drive store traffic with promotional items. It still relies heavily on circular advertisements. CVS relies more on data from its rewards program and looks to optimize purchases from existing customers," says Halper.

To get the best prices, Dworsky recommends the obvious: Comparison shop, check all the ads, and then cherry-pick the best deals.

Bargain hunter and extreme couponer Marcia Turner couldn't agree more. "Drugstores like Walgreen's, CVS and Rite Aid generally have higher prices on grocery items, but their sale prices on those same items are also frequently less than the everyday supermarket prices. For example, Walgreen's here in Rochester, N.Y., has small bottles of Simply Orange brand juice for $1.79, which is not a great deal. But a couple of weeks ago they had a sale on that orange juice, bringing the price down to 99¢ a bottle, plus, there was a $1.00 off coupon that could be applied, bringing the final cost to the consumer down to free," says Turner.

"CVS also puts its small boxes of cookies and crackers on sale regularly, reducing the price from $1.99 -- which is not a great deal -- to 99¢, which is. And then, again, with a $1 coupon, you can get the crackers for free. I don't usually see grocery stores marking down these items, so buying them on sale at drugstores does yield decent savings. And then some weeks you'll see milk as a loss leader at drugstores, when it is priced below grocery stores. This doesn't happen all the time, but often enough that I shop around."

For sure you have to work the system. However, says Dworsky, "Think twice before you buy grocery items at your local drugstore. While you can on occasion find a deal there, they seem to be few and far between. Shoppers are usually better served buying groceries at a regular supermarket or superstore."






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65 Comments

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H

I guess turnabout is fair play. Grocery stores have all horned in on the pharmacy business, so drugstores have to go for their cut from the grocery business. That people are impulse buyers is their own fault. Don't blame the prices, blame your own stupidity for not looking at them before putting the item in your cart. If they didn't have enough suckers buying those items at those prices, they'd either cut prices or stop stocking those items. If you want the convenience of one-stop shopping, you'll pay for it.

October 15 2011 at 10:52 AM Report abuse rate up rate down Reply
BigDoggie

Apparently the writer of this article has never been to Hawaii. If she did, she hasn't been in a Longs Drug store, which is now owned by CVS. The Hawaii Longs stores is the reason CVS decided to buy Longs Drugs. The Hawaii stores were allowed to keep the Longs Drugs name, since it was doing so well. You'll find many items that are very competitive priced, not just against the supermarkets, but Costco and Walmart as well. The Hawaii Longs stores have been able to maintain their excellent variety of local brands and merchandise, instead of being cookie-cutter stores like many mainland retail operations. I've gone into Walmart and found many items that are priced higher on an everyday basis than Longs. The stores are packed, especially on Sundays, when the weekly ads break. The mainland CVS stores and Walgreens, don't have the daily traffic that a Longs Hawaii store has on a slow day. Walgreens has come into Hawaii, but they have not adapter to the local market, and their foot traffic is more like a mainland drug store. Maybe the writer can take a trip to the islands and see for herself, what a drugstore can be like.

October 15 2011 at 1:22 AM Report abuse rate up rate down Reply
brejr

I did not even waste my time to finish reading the article. It is HOGWASH! I don't even care to know who wrote the trash. I know PHARMACIES (the correct term) from the 1940's. Ice cream was sold in them then so that is nothing new. You did not even mention the 24/7 7-11's, etc. Now that is where you are burned. The items that you mention are there as a convienence and for no other reason. No one is compelled to buy the items in a Pharmacy. Get a life whoever you are and quit wasting space on AOL. By the way, Pharmacists are THE highest rated professionals period, and that is from a poll conducted by a non bias group. I would trust my Pharmacist with my life and all of my worldly possessions. He is there 24/7.

October 12 2011 at 8:16 PM Report abuse rate up rate down Reply
mdarby6326

It's almost impossible these days to "find" pharmaceutical items with all the groceries in the front of our drugstores. I am totally put off by this at CVS and Duanne Reade, the two drugstores at which I shop in NYC. Duanne Reade in my neighborhhod has groceries on the main/first floor, an elaborate cosmetic department on the second floor and pharmacy items in the basement!! It seems the "drugstores" are trying to compete with the fast food and regular stores. Some enterprising business concern should come in and take away the pharmacy business!!

October 12 2011 at 8:04 PM Report abuse rate up rate down Reply
1 reply to mdarby6326's comment
Master of my fate..

All business want to, NO NEED TO Expand, try new things, give their businesses a new look, try different products, see what works.
Starbucks was born from the local coffee shop. 99 cent store, Dollar store was a novel idea. UPS, FedX saw a need for better cheaper service the post office could not provide. Remember when you had to go to a computer store to buy a computer ? Now computers are commodities, mass marketed sold in any electronic store, Wall Mart, K-Mart or Costco along with clothing, groceries and tooth paste.
IT'S CALLED FREE MARKET CAPITALISM. It has it's downsides, overreaches, sometimes it turns greedy, full of failures and mistakes, but mostly it works just the way it's supposed to.

October 12 2011 at 11:12 PM Report abuse rate up rate down Reply
paigeotron1

The Long's Drug Store chain (here in Hawaii) actually is very competitive and many times beats even Wal-mart. Yes, you have to be aware of how much things typically cost, but I usually hit the Longs before the supermarket or the Wal-mart.

October 12 2011 at 7:47 PM Report abuse rate up rate down Reply
catkillscar

Sharon, the Patient Assistance you applied for pays the drugstore for everything but the $30 you are getting charged. It is the Drug Manufacturer that is making all the money, not the pharmacies. For example, take the drug you were paying 100% cash for was $169.00. If the pharmacist runs the Patient Assistance card through the computer, the Manufacturer will pay $139.00 for it and you pay the remaining $30.00.

Usually, these types of assistance programs are only for brand drugs, which the pharmacy makes very little on. There is more profit in generics for pharmacies. The only reason the manufacturers have these patient assistance programs in the first place is to bump their sales up.

Bottom line is that I can guarantee you the pharmacy isn't making nearly as much as you think.

October 12 2011 at 7:35 PM Report abuse rate up rate down Reply
1 reply to catkillscar's comment
brejr

AMEN! NO ONE could have said it any better. Thanx.

October 12 2011 at 8:25 PM Report abuse rate up rate down Reply
dbrockskk

must be me. I always knew this.

October 12 2011 at 7:34 PM Report abuse +1 rate up rate down Reply
Sharon

Well, I personally know that the drug stores are ripping people off big time on medications. My doctor prescribed me a med that was $216 at the Food City pharmacy, & $169 at the Kroger pharmacy. Yet, when I applied for patient assistance with the manufacturer, I now get my med at $30 for a 3 month supply. So, if the manufacturer can sell it to me that cheap, then you KNOW the drug stores don't pay that much for a lot of the meds they sell.

October 12 2011 at 7:12 PM Report abuse +1 rate up rate down Reply
1 reply to Sharon's comment
brejr

SO you are on welfare, food stamps, and Medicaid. That is wht the rest of us hard working people have to pay so much so that you can get a hand out at below cost. Get a job!

October 12 2011 at 8:23 PM Report abuse -1 rate up rate down Reply
1 reply to brejr's comment
dcp

If she was on Medicaid, her script would have been paid for.
Manufacturer Patient Assistance is by the (duh) manufacturer. It doesn't hurt "you working people" (although, since Sharon has to pay for her meds, we know she's not on Medicaid, likely not on Medicare, and probably a "working people.)
Far more people than apply for patient assist. by PharmCo's, are eligible for it. If you're paying full price for a multi-hundred dollar script out of pocket (that likely cost in the tens of dollars 5-10yrs ago), and you haven't looked into assist programs by the manufacturers, you're giving away $$$.
Meaning- you're stupid, that's why you pay so much.

October 15 2011 at 6:24 AM Report abuse rate up rate down
lukedude27

Even the drugs are expensive at CVS I bought a bottle of Ibprofin there a couple weeks ago and it was $11.99 My back was hurting and I just paid. A week or so later I was shopping at the local Kmart with my wife I saw the same bottle for $6.99 (same brand and quantity) I was shocked. Thats $5 more! I will never go back to CVS! Its sad they charge that much more.

October 12 2011 at 7:09 PM Report abuse -1 rate up rate down Reply
2 replies to lukedude27's comment
brejr

So you are on food stamps, medicaid, and welfare. That is why the rest of us hard working people have to pay so much to make up for your getting a handout at below cost. Get a job!

October 12 2011 at 8:20 PM Report abuse rate up rate down Reply
brejr

I apologfize Luke. My comment was intended for the comment above yours. Again, I apologize sincerely.

October 12 2011 at 8:24 PM Report abuse rate up rate down Reply
PETE

they not cheap

October 12 2011 at 6:59 PM Report abuse rate up rate down Reply