Sounds like some idiotic pricing scheme. As a customer, I can always play, let it rot on the shelf game.
By all means shop around, but don't waste your gas driving around or succumb to the web ordering shipping charges.
In my area Mexene is the popular choice in chili powder. Unfortunately, I haven't seen Gebhardt's chili powder, in my neck of the woods. Push come to shove I will generally go with a high quality foodservice chili powder, 18 to 24 oz. But I do not get the super size 4 to 5 pound jugs of chili powder.
I think you need to shop around...that's way out of line. I just did a quick web-check on prices and didn't see anything over $4.50...$4.00 seems to be the going rate. I agree that there's nothing better...my Daddy cut corners on lots of things, but he always bought Gebhart's for his chili!