The Reason Walmart Groceries Are So Cheap

Walmart is known for a lot of things — being a one-stop shop for basic household needs, People of Walmart fodder, and of course, its Everyday Low Price Guarantee and rollbacks. Even if you're not a fan of the retail giant, it can be hard to pass up its deals and prices, especially when you're trying to save money.

The store's groceries serve as a prime example of its competitive prices. In a May 2022 Memphis FOX13 Investigates segment, reporter Carolyn Cedra compared 10 grocery items between Walmart and three of its competitors. Walmart beat the competition by as much as five dollars. If you've ever purchased a candy bar at a Walmart register, you may have noticed those items are also typically cheaper than in other stores. For example, a bag of Snack Size Kit Kat at Walmart costs about $3.50 (prices may vary online in stores and in-app), but at Kroger, you'll have to pay about 50 cents more.

Walmart's food prices aren't the lowest on every product, but overall, its grocery prices are sometimes hard for many competitors to beat. But the question is, why? Why are Walmart's groceries so cheap? It all boils down to the power of Walmart's financial footprint.

Walmart is the largest grocery chain and retailer in the U.S. and a powerful negotiator with vendors

According to John Karolefski, a grocery store analyst and editor of Grocery Stories, "Walmart can demand the lowest price from vendors and manufacturers and get the lowest price from them because they have so many stores." About 10,500 stores in 24 countries, to be more specific (via Walmart).

Walmart isn't technically classified as a supermarket, but it's actually the largest grocery store chain in the U.S. In 2021, the store made more than $465 billion in grocery sales alone. It's also the largest retailer in the U.S.; it raked in nearly $460 billion in retail sales in 2022 (via National Retail Federation). Basically, the more sales Walmart makes, the more powerful a retailer it becomes; the more powerful a retailer it is, the more positioned it is to negotiate for low prices.

Other items that are often cheaper at Walmart

Walmart's low-price strategy applies to every item it sells, not just food. Take its photo print services as an example. You can get 4x6 photos for about 12 cents per photo, but at CVS, you'll end up paying nearly three times that amount for the same-sized photo.

According to GoBankingRates, other items that are typically cheaper at Walmart than other stores (if you buy Walmart's private label products) include paper towels (Great Value) and ibuprofen (Equate). The site also lists vacuums, luggage, newborn diapers, and Chromebook computers as items that you can purchase for a lower price than competing stores. The price difference isn't always substantial, but over time, the savings can add up and make a noticeable difference in your bank account.

When Walmart stores are able to acquire items from vendors for a low price, it can sell its groceries and other merchandise for a low price, so you can "Save Money and Live Better."