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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