No, you’re not imagining it — your grocery bill is more expensive depending on which City Market you shop at. If you live in a mountain town where grocery stores are few and far between, Kroger’s pricing strategy argues you should be paying more.

Higher prices for Western Slope stores is one of the reasons why preserving competition has become a big focus for the three separate antitrust cases challenging Kroger and Albertsons’ merger plans.

The Colorado lawsuit over Kroger Company’s $24.6 billion acquisition of Albertsons wrapped up Oct. 24. Judges from Colorado, Oregon and Washington are now deliberating the fate of what might be the largest supermarket merger in U.S. history.

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Kroger, Albertsons merger faces anticompetitive claims 

Kroger and Albertsons announced their almost $25 billion merger deal in 2022, which was met with separate lawsuits from the U.S. Federal Trade Commission, Colorado Attorney General Phil Weiser and Washington Attorney General Bob Ferguson. All three claimed the merger was anticompetitive, and that it would cause store closures, higher prices, and in Colorado specifically, worsening supply chains.

Kroger and Albertsons argue the merger would help them compete with large companies like Walmart and Costco, though they later agreed to halt the merger until legal action against the deal was complete. The Colorado case went from Sept. 30 to Oct. 24 in Denver.

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If the merger is approved by regulators, 579 grocery stores nationwide would be sold to grocery store supplier C&S Wholesale Grocers, including 10 on the Western Slope, in an effort to satisfy regulators.

Without a firm timeline, it is unclear when each court will announce a decision.

Kroger raises prices for stores in resort mountain towns

Weiser’s argument for preventing decreasing competition for Kroger in Colorado is “when there’s a lack of competition, prices go up.”

Kroger’s pricing strategy on the Western Slope seems to support Weiser’s point.

On the second day of the Kroger-Albertsons trial in Denver, Colorado’s legal team questioned Kroger executives on their pricing for stores in mountain towns across the state. During testimony, Senior Director of Pricing Andy Groff explained the “mountain no-comp zone” was established in 2022 in response to inflation, as first reported by The Denver Gazette.

Eight Kroger stores in Colorado were identified as having little to no competition, including City Markets in Aspen, Glenwood Springs, New Castle, Eagle and Vail.

The Summit Daily visited City Market and King Soopers locations for the mountain towns mentioned above, as well as competitive areas in Dillon and Denver, to test the difference in Kroger’s pricing for resort mountain towns on the Western Slope. Original prices were recorded for the same 19 common grocery items across all seven Kroger stores.

The items compared consist of a mix of brand products and, where applicable, their Kroger-owned competitors: eggs, milk, bread, chicken, pasta, canned food, olive oil, butter, toilet paper, diapers and soap. While the prices for some brand items were consistent across locations, Kroger-owned products were most expensive in Glenwood Springs, New Castle, Eagle and Aspen by an average of 6.8% per item. The only exception was eggs, which were most expensive in Denver.

A grocery bill of all 19 items, from least to most expensive, would look like this at each location:

1. Vail City Market ($127.55)
2. Dillon City Market ($128.55)
3. Denver King Soopers ($128.75)
4. New Castle City Market ($129.38)
5. Glenwood Springs City Market ($131.97)
6. Aspen City Market ($132.47)
7. Eagle City Market ($132.77)

The increase in price from Vail to Eagle is 4.01%. The average monthly grocery bill for a family of two in the U.S. is roughly $470, meaning a customer walking out of Vail’s City Market with a $470 bill would be paying almost $490 in Eagle for the same items.

Eagle is considered a low-competition area. Although there is one Costco location in the town of Eagle, the store’s membership requirement separates part of its customer base from Kroger. Vail, on the other hand, has a Safeway in the same West Vail shopping center as the City Market, making it a competitive area.

The Vail Safeway, owned by Albertsons, costs around 14.5% more than City Market, which is why some fear Kroger’s acquisition of Albertsons would give the company freedom to raise their prices. Similarly, a Safeway in Denver is 11% more expensive than a King Soopers in the same city.

When only comparing the eight Kroger-brand items on the list, the bill would cost 7.5% more from the Aspen City Market than it would from the one in Vail, meaning $470-worth of items for a family of two at Vail’s City Market would cost $505 in Aspen. Aspen is considered to be an area with limited competition. The closest alternative grocery store is Clark’s Market, which is locally owned and lists higher prices than City Market.

Kroger’s brand of white bread alone costs 10% more in Glenwood Springs, New Castle, Eagle and Aspen than in Denver, Vail and Dillon; followed by 8% for Simple Truth (Kroger-owned brand) one-gallon milk. Though some brand products like Horizon milk, Eggland white eggs and Perdue chicken breasts cost the same across all seven stores, other brand products like Barilla pasta cost up to 10% more in stores with less competition.

A Kroger spokesperson said during the Colorado trial that their higher prices in the Western Slope exist to offset the rise in fuel and labor costs, which makes it more expensive for trucks to go through the mountains. Vail’s cheaper prices contradict this claim, since the mountain resort town is also located west of the Eisenhower Tunnel. Considering that Vail and Dillon — both on the Western Slope — offer prices lower than Denver, this suggests Kroger’s pricing strategy is driven by competition rather than fuel and labor costs.

In order to win the case, the Colorado judge must agree with Weiser’s argument that the merger’s elimination of competition would harm consumers by giving Kroger a monopoly in parts of Colorado.

Craig Press’s regional reporters Elliott Wenzler, Ali Longwell and Robert Tann contributed to this report.