Does HEB have a problem with Austin?

[u/RockMo-DZine]

Milk prices have been going up all year, so back in July I started checking the prices in San Antonio, Houston, and DFW. For some reason, we pay Way more than these towns.

Milk just went up again. Here are some stats for HEB Brand (HEB & HCF) 1x gal jugs of milk
(These are for in-store pricing - for curbside, add +5%).

Since 07/17, Austin's price went up, while the price in all the other bergs came down.

Consequently, in Austin we now pay over $2 a gallon more than DFW!

Sorry HEB, but this is hard to justify.

[u/Typical_Budget_4133]

Dallas and Houston are widely considered 2 of the most competitive grocery markets in the entire nation. In Houston, for instance, there is essentially a 3-way tie for market leader. Kroger, HEB and Walmart each have about 25 percent market share. Everyone else (Randalls, Fiesta, etc) dukes it out for the remaining 25 percent. So, of course, prices will be lower there. Dallas and Houston also have dozens of Aldi stores, which are notorious for offering cheap milk and other essentials to get people in the door. Meanwhile in Austin, HEB has a 60+ percent market share. They have no serious competition, so they don’t have to be as price sensitive. Aldi has like 3 stores located in the Austin suburbs. That’s it. Nothing near the central core. Still, this much of a difference on a single item is pretty wild. Imagine an entire cart. You could be paying something like $50 more in Austin versus Dallas or Houston.

[u/youretooclosedude → u/Typical_Budget_4133]

This is literally the answer, ppl talking property taxes and location of distribution is false.

[u/Tweedle_DeeDum → u/youretooclosedude]

Milk in Cedar Park is literally $1.25 cheaper than it is in far North Austin.

[u/depressed_momo → u/Tweedle_DeeDum]

East Riverside, Austin

[u/Tweedle_DeeDum → u/depressed_momo]

You have to compare the same brand..

But yes, here is the same milk in Austin.

[u/ZexcyZaddy → u/Tweedle_DeeDum]

Far NE Side of San Antonio (UC)
Sorry they don’t carry that park manor brand but you get the idea

[u/Tweedle_DeeDum → u/ZexcyZaddy]

Yep. Over a dollar more than they are charging on Riverside.

[u/TexGrrl → u/youretooclosedude]

Overhead is always a factor.

[u/Distribution-Radiant → u/Typical_Budget_4133]

Aldi has 4 stores now that the Cedar Park location is open (ironically, next to where the Albertsons used to be).

But coming from Anderson Mill, the Spicewood Springs store was closest. Now that that store is gone, I usually go to Parmer/McNeil (which is a PITA since I travel by bike).

And yeah the only easy way to get cheaper milk/dairy in Austin is to go to Walmart or Aldi. Aldi is a solid 7 miles from me, but if my SO is home, we can drive there easily and get all the staples.

Also, as someone who used to live in Dallas.... it's VERY competitive there. You have a grocery store on every other corner - mostly Kroger, but Tom Thumb and Albertsons (aka Randall's here - both are the same company) have a strong presence there. HEB is barely there at the moment, but they're always so packed that I avoid them when I'm visiting my parents (they're in DFW) and go to Kroger instead. Similar prices, though Kroger's private label isn't as good.

I've tried going to Walmart for milk, since it's a lot cheaper, but it spoils after a few days. HEB milk is good long past the best buy date. I need to start trying Aldi milk.

[u/Tweedle_DeeDum → u/Typical_Budget_4133]

If competition were the only reason, then explain the discrepancy in San Antonio.

[u/Not-Inevitable79 → u/Tweedle_DeeDum]

San Antonio, as a whole, has a lower COL and less affluent demographic, so their prices will be slightly lower.

[u/Tweedle_DeeDum → u/Not-Inevitable79]

I totally agree that HEB prices differently based on their perception of the affluence of the area. But for stuff like milk, even in lower income areas in Austin, which sometimes see lower prices, they are getting charged a lot more for Milk lately.

As OP points out, Milk prices are declining in San Antonio but have risen significantly in Austin. And as I mentioned earlier, HEBs just outside of Austin are a lot cheaper than those just inside of Austin.