Living with credit, New products, Rewards, Shopping

Can 5 percent cash back help Whole Foods compete on price?

Mike Cetera

Like cookies, shopping at Whole Foods is a sometimes treat.

This posh grocer has rarely been able to compete on price, so it’s never been my go-to for everyday meal planning. My family shops here typically for special occasions, like holidays and our annual Academy Awards appetizer feast.

But after Amazon bought the chain last year, it cut prices on some products and said that Amazon Prime would be Whole Foods’ customer rewards program.

Now Amazon is offering an across-the-board 5 percent discount to Whole Foods customers who use the Chase Amazon Prime Rewards Visa Signature card to make purchases at the store. Whole Foods shoppers who use the Amazon Rewards Visa Signature card earn 3 percent at the register.

This 5 percent ranks among the best cash back rewards for grocery shopping. But is it enough to overcome the store’s (perceived at least) high prices? I conducted a small experiment to find out.

After Amazon announced the new reward for shopping with its Visa card, I visited a Whole Foods store in North Texas where I live and randomly surveyed the price on 17 different items. I then compared the cost of those items with the prices charged by a nearby Kroger.

Whole Foods is an attractive store for some consumers because it frequently features locally sourced goods and brands that aren’t ubiquitous in most supermarket aisles. This makes an apples-to-apples comparison a bit tricky, but I did my best to choose items I knew would also be found on a typical grocer’s shelves. That’s why you’ll find no artisan cheese in this survey.

Comparing prices

Spoiler alert: Overall, Whole Foods prices were higher on the groceries I chose than similar items at Kroger. But I was surprised at how competitive the chain is on produce, which was priced close to – if not cheaper – than Kroger. For example, Whole Foods was selling bananas for 49 cents a pound, 6 cents cheaper than Kroger.

Even so, Whole Foods won the price war on just four of the 17 items I picked. I compared prices on staples like pasta, dairy, meat and beer.

Whole Foods’ best price in comparison was on a 32-ounce container of organic chicken broth, which it sold for 90 cents less than a similar item at Kroger. Its worst price by comparison – on a 12-ounce bottle of organic honey – cost $1.50 more.

Whole Foods versus Kroger on 17 prices

Grocery item Whole Foods Kroger
Ozarka natural spring water (gallon) $1.49 $1.29
Veggie Noodle Co. Butternut Veggiccine $3.99 $3.99
Bananas (lb.) $0.49 $0.55
Sam Adams Cold Snap beer $8.99 $7.99
Watermelon chunks $2.99 $2.99
Atlantic salmon filets $9.99 $8.99
Chicken breasts, boneless, skinless (lb.) $4.99 $3.59
Organic honey (12 oz.) $5.49 $3.99
Tabasco sauce (2 oz.) $2.29 $1.69
Organic chicken broth (32 oz.) $2.99 $3.19
DeCecco spaghetti (1 lb.) $2.79 $2.19
Kind dark chocolate chunk granola bars $3.99 $2.99
1% low-fat milk (gallon) $3.19 $2.49
Simply Orange orange juice (1.75 liters) $3.99 $3.99
Chobani yogurt (5.3 oz. container) $0.99 $1.00
Eggs, large white grade A (dozen) $2.99 $2.69
Ground beef, 90 percent lean $4.99 $5.49
TOTAL $65.93 $59.10
TOTAL with 5 percent discount $62.63

In total, Whole Foods charged $65.93 for the 17 items, while Kroger wanted $59.10.

Savings using the Prime Visa

That price gulf is pretty big. Obviously, it could be larger or smaller depending on what you shop for. But the difference – in this case, at least – demonstrated that a 5 percent cash back reward isn’t enough to make up for Whole Foods’ higher prices.

If you used the Prime Visa to purchase these 17 items, you’d save $3.30, well short of the $6.83 price difference between the two stores.

Is the Amazon Prime Visa card worth it?

That being said, if you’re a regular patron of Whole Foods, this card will help you save money. Just don’t expect it to be a price miracle worker.

And, if you use it to make purchases on, you’ll also earn 5 percent cash back. The Prime Visa pays 2 percent back on restaurant, gas station and drugstore purchases and 1 percent on other purchases, as well.

If, like me, groceries are your biggest weekly expense outside of a mortgage, you may consider using a credit card that pays rewards on all of your grocery shopping, not just at a single store.

The Blue Cash Preferred Card from American Express, for example, pays 6 percent back on up to $6,000 in annual purchases made at U.S. supermarkets (including Whole Foods), then 1 percent thereafter. Max out this benefit and you’ll earn $360 cash back per year.

The reward from AmEx is a bit higher than on the Prime Visa card, but the Blue Cash Preferred card also comes with a $95 annual fee. The Prime Visa is free to own as long as you have an Amazon Prime membership, which costs $99 per year. The Prime Visa also doesn’t have a cap on the rewards you can earn at the 5 percent rate.

If you’re a Whole Foods shopper, you’ll have to crunch some numbers to see where you can find the best value.

See related: Is Amazon Prime worth it?Guide: How to maximize your cash back on

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