(NEW YORK) — Before you head out to a retail store to buy that item you’ve had your heart set on, you may want to check the price listed on the retailer’s website to ensure you get the best deal.
“There have always been some companies that have different online prices compared to their brick-and-mortar-store prices,” Edgar Dworsky, Editor of Consumer World, tells ABC News.
In fact, Consumer Reports singled-out Radio Shack last year in its Naughty & Nice list, dinging the company for charging double the online price for an HDMI cable in stores. Nevertheless, retailers continue to charge more in stores for two main reasons: physical stories have higher overhead, and are run by separate business units.
“The overhead for the Internet store is lower than the overhead for the brick and mortar stores. With the online stores, they aren’t paying rent or for the same number of employees,” Dworsky says.
The second reason — that online and in-store sales are usually separate — is more complicated.
“It’s been a problem for a lot of these retailers — they are siloed in different divisions. The online arm doesn’t talk to the retail arm,” says Michelle Madhok, founder of SheFinds.com and an online shopping expert.
Tod Marks, Senior Editor of Consumer Reports, says, “Some companies are set up do the online arm as a different ‘corporate’ entity as an explanation for the price variation. Whether consumers choose to believe the explanation is up to them.”
Retailers didn’t outright explain the reasons for the overpricing in stores to ABC News.
“In most cases, Walmart.com has the same prices as Walmart stores,” said Walmart’s Director of Public Relations, Ravi Jariwala. “However, like our stores, which have the ability to adjust item prices in order to be competitive within their particular trade area, Walmart.com also has to adjust prices on occasion in order to be competitive with key online competitors.”
Target’s spokesperson said something along the same lines: “We strive to provide competitive prices online and in our stores. At times guests will find different prices based on what we’re seeing within the competitive set, whether that’s in stores or in the online space.”
Macys and Kmart did not respond to ABC News’ request to explain why prices are higher in their stores.
But not all is lost if you find a lower price online. Some stores, including Target and Best Buy, will match the prices of their online counterparts.
Copyright 2012 ABC News Radio
Sara Ashley O'Brien, CNN
Aaron Smith, CNN
Paul Menser, BizMojo Idaho