Supermarkets are in business to make money, so they charge what they can. More competition usually means lower prices. There’s more competition in Brooklyn than in Queens or the Five Towns, and more in those than in Baltimore or Detroit. In addition, shipping costs raise the prices of kosher food that’s out of the NY area (though both Detroit and Baltimore have local CY milk, while LA imports its CY from NY!).
GG’s prices in the 5 Towns are high, but they seem to do a good business, possibly because area residents are less price-sensitive. GG opened Kolsave, with lower prices and a smaller selection in the old Brach’s location.. GG’s prices in Boro Park are higher than KRM’s and it shows in the relative amount of business they do — whenever I’ve been in GG-BP it’s been pretty empty, while KRM is usually crowded.