It is not really difficult to imagine this. For example, Safeway near the Caltrain station in SF has exorbitantly priced groceries than Costco or Safeway in Sun

It is not really difficult to imagine this. For example, Safeway near the Caltrain station in SF has exorbitantly priced groceries than Costco or Safeway in Sunnyvale. They maybe using this to their advantage. Hence, for a SF user, it might be cheaper still to use Instacart which in turn gets its groceries from other cheaper stores. And since they do this in bulk, the economies of scale sides with them.