Whole Paycheck?

Maybe you've heard the joke "Whole Paycheck" referring to Whole Foods. It can be expensive. However, the truth is that in many ways Whole Foods is cheaper than a regular grocery store like Safeway.

In the Undercover Economist Tim Harford explains that Whole Foods costs more only when you buy higher-end and/or more unusual items that you simply would not find at Safeway. So it's not that Safeway is cheaper, it's that it sells mostly high-volume, mass-produced, and/or lower-quality stuff.

Harford points out that a bottle of mineral water costs less at Whole Foods than at Safeway. It's because at Whole Foods mineral water is part of "the basics" whereas at Safeway most customers would find mineral water a luxury.

Take the goat milk that I buy every week (sometimes every day). It costs $3.79 a quart. That's over $15 a gallon, which is a ton. But it's not that expensive because it's at Whole Foods, it's expensive because it's unusual. You can't find goat milk at Safeway at all.

Or take the salad bar. Safeway sells bare bones salad, none of it organic. Whole Foods salad bar sells much more variety including organic and it is better prepared. So the price per pound may be higher but you get something more.

It works the other way, too, however. Whole foods sometimes does not offer just plain old cheap stuff. They don't sell cheap paper towels, they are all recycled and specially made, etc. So if you don't really care about how eco-friendly your paper towels are and just want Bounty, you are going to pay more by going to Whole Foods.

So the bottom line is
-Whole foods is cheaper, not more expensive, than Safeway on identical items
-It is up to you to spend your money or not on individual higher-end or unusual items that Whole Foods carries that you cannot find elsewhere.