Price wars heat up Valley

JOEL DAVIDSON\Frontiersman reporter

MAT-SU -- What happens when five major retail outlets all guarantee lowest prices in town? The Home Depot, Lowe's, Wal-Mart, Sears and Fred Meyer all claim to have the best deals for Valley consumers looking to save a buck.

Home Depot and Lowe's, the first- and second-largest home-improvement retailers in the world, respectively, both have agreements with shoppers that if they can find an item cheaper at a competitors store, they will match the lower price and then drop another 10 percent off its own price.

Managers at both companies, however, are quick to point out that clearance, close-out and promotional offers don't apply, along with a host of other exceptions.

"I will take care of my customer," said Kirk Thrift, manager of the Wasilla Lowe's store. "I will match and beat any price, whether that be from Wal-Mart or Home Depot -- it doesn't matter."

Not to be outdone, the other retailers take similar approaches. Sears, like Lowe's and Home Depot, also agrees to match and beat the competition when it comes to price.

Wal-Mart takes a slightly different approach.

According to an assistant store manager, Pam, who requested that her last name not be used, Wal-Mart tries to beat the competition beforehand. She said Wal-Mart employees go over ads in the local papers each week to see if the competition has lower-priced merchandise.

When they find an item priced lower than their own, Wal-Mart matches the price and then automatically reduces the cost of its own product by another 5 percent for all customers.

"Every week we try to shop our competitor ahead of time," Pam said.

They don't catch everything, however, and if a customer comes in with an ad or information that a competitor is advertising a lower price, Wal-Mart will match that price at the register. The store can't take off the extra 5 percent at the register, though -- the extra 5 percent is taken off only if Wal-Mart finds it ahead of time.

Pam said the items must be exactly the same brand, style, make and model in order for Wal-Mart to honor its agreement.

Fellow assistant Wal-Mart manager Terry Voorhees said the deal also only applies to items that are marked at a specific price by the competition.

"We don't do gimmicks like 'Buy one, get one free,' and we don't do percentages off," he said.

According to Voorhees, Wal-Mart will usually just take the customer's word for it when they claim to have found an item cheaper at another store.

"We take this very seriously," he said, "and nine times out of 10 we will just make it happen."

The deal does not apply to wholesalers like Sam's and Costco -- only to fellow retailers.

According to a recent national market analysis survey, low prices are the second-most important quality for shoppers. Only store location is a higher concern when choosing where to shop.

For Valley shoppers, this kind of intense price war is a fairly new and welcome addition to the shopping environment.

"Low prices are the number-one thing," one Wasilla Fred Meyer shopper said as she pushed a cartload of items out the door.

Fred Meyer promises to match the competition on all non-food items, with a few restrictions.

The high consumer priority on low prices doesn't bode well for smaller stores competing with large retailers, however, and many are trying to specialize -- a trend Wal-Mart researcher Kenneth Stone has documented as imperative if small business is to survive in large retail towns where the battle for consumer loyalty often hinges on providing the lowest-priced merchandise.

Contact Joel Davidson at joel.davidson@frontiersman.com.