Your Money: Deep discounters

GRAND RAPIDS, Mich. (WOOD) - Grocers Aldi and Save-a-lot claim to beat the prices at traditional supermarkets by as much as 50 percent. Rae Ann Herrema started shopping at Aldi last summer and believes it.

"It's definitely cheaper than most other stores," Herrema told 24 Hour News 8. " I go to other stores when there are coupons and sales that are good deals but for basic items, they're better here (at Aldi.)"

24 Hour News 8 created a list of 31 random items and priced them at Walmart's full-service grocery center, plus an Aldi and Save-a-lot. We priced the cheapest brand available for the product, and in almost all the cases it was the store's private label.

Aldi beat the competition, hands down. For 31 random items, the total was $51.83, more than $7 cheaper than Save-a-lot ($59.15) and nearly $14 lower than Walmart ($65.52)

Aldi won by offering small prices differences many items, and were the price leader on 26 of our 31 items. Milk was nearly $1 less than Walmart, and spiral cut ham was cheaper by $1.30 per pound.

Aldi seems to live up to its claim that it beat prices at traditional stores by up to half. In our first survey, Walmart was 28% lower than everyone else, and Aldi is 20% less expensive than Walmart. That's nearly half.

The dairy case was noticeably less expensive, nearly 50% less on milk and on butter.

"What we do everyday is to try to have our prices as low as possible," said Aldi Vice President Dan Sefton. Aldi isn't based in West Michigan, and you won't find many of the name brands at traditional stores, but that's not a trade-off, he said.

"I can tell you, the quality of our products, if it can't meet or exceed the name brand product quality, we will not carry it."

Aldi keeps prices low in two ways: efficiency and simplicity.

There are no non-grocery services that have to be factored into the price. You pay with either cash or a debit card. You bag your own stuff with your own bags. And if you don't return your shopping cart, it costs you a quarter.

"That's another cost we don't want our customers to have to incur," Sefton said.

By selling off-brands, Aldi doesn't have to deal with coupons or manufactuer promotions. It eliminates one of the biggest expenses for Michigan grocers -- mandatory price stickers on products. Aldi gets the food suppliers to print the price right on their box

That "reduces our payroll costs to have employees do that, because there is a cost associated with price marking of items."

While slightly costlier, Save-a-lot accepts credit cards and says it offer more brand items.

But shoppers at Aldi don't seem to mind the off-brands.

"If there's a brand that I really want, I'll go somewhere else to get it," said Aldi shopper Lauri Haahn, "but there are brands here that I even prefer over other brands."

Aldi has five stores in the Grand Rapids area and is planning to add more. Save-a-lot stores are independently owned.

Inside woodtv.com:

Anne Schieber's grocery list of 31 random items