Walmart and Kroger are in a price war, and Walmart is winning.
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Walmart's relentless price war is crushing America’s biggest grocer (WMT, KR)
Walmart's groceries are about 4% cheaper than Kroger's, according to a recent price check by Barclays.
A Walmart in Richmond, Virginia.
The retailer's groceries cost about 4% less than Kroger's, according to a recent price check by Barclays.
Analysts compared prices on a basket of 78 identical items at Walmart and Kroger stores in Nashville, Tennessee, to determine which retailer was cheaper.
Walmart offered lower prices than Kroger on 74% of the items checked.
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Barclays found the biggest price differences between the two retailers on nonperishable and frozen items, where Walmart had a 5.6% price advantage over Kroger.
Kroger was cheaper than Walmart in the "fresh" category, however, which includes proteins, dairy, and vegetables.
Kroger was 3.3% cheaper in that category, but mostly because of steep discounts on a few items including eggs, apples, green grapes, baby carrots, bell peppers, and chicken breasts. Excluding those items, Kroger's "fresh" products cost 15% more than Walmart's, according to Barclays.
But Kroger appears to be losing the battle.
The chain's same-store sales, or sales at stores open at least a year, fell 0.7% in the most recent quarter, marking the end to a staggering 13-year streak of quarterly same-store sales increases.
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The company blamed food-price deflation for the decline, but it's clear that Kroger is also feeling pressure from competitors.
Barclays analysts said Kroger may have a hard time catching up to Walmart on price.
"While we feel Kroger has clearly proven over the years that it is a superior operator, the magnitude of Walmart's investments may prove difficult to overcome," analysts wrote.
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