> First you're paying for the store. That's real estate costs -- currently excruciating. Property tax and insurance, based on the real estate prices. The store needs heat and light, that's oil and electricity. There are people who work at the store, has your state recently increased its minimum wage?
Same box of cereal costs the same in Southern California and South Carolina. South Carolina is cheaper in every way - electricity, rent, insurance, and labor. Same $8 premium cost for a commodity product that costs a dollar or so to land.
No one is competing for the customers' dollar, they are imposing a price scheme because there is extremely limited competition and distributors are being allowed to abuse their pricing power.
Cost of living index is 96.5 in South Carolina, 134.5 in California. It's higher in California but not by an order of magnitude. Somewhat unexpectedly, grocery costs are not just the same but actually higher in South Carolina:
Could be California's higher population density allowing store costs to be spread across more units.
Also unexpected: The highest and lowest grocery prices in the continental US are Vermont and New Hampshire, respectively, and they're geographically right next to each other with nearly identical cost of living index but Vermont is paying 2.7x as much for groceries. But New Hampshire does also have 2.2x Vermont's population density.
In any event, price fixing doesn't seem like a strong explanation, because what are they doing, fixing prices in Vermont but not in New Hampshire?
Same box of cereal costs the same in Southern California and South Carolina. South Carolina is cheaper in every way - electricity, rent, insurance, and labor. Same $8 premium cost for a commodity product that costs a dollar or so to land.
No one is competing for the customers' dollar, they are imposing a price scheme because there is extremely limited competition and distributors are being allowed to abuse their pricing power.