The product information including pricing and availability come from the Google Merchant Center, which gets information directly from retailers. The same retailers pay for the Product Listing Ads on a cost per click basis. Right now, this detailed information is available for a limited number of retailers, but on the Google Commerce site there is a form retailers can fill out to be included in the local shopping service.
The new focus on local retailers should help both the retailers and the customers who might want to use Google to find local stores that carry a product. This way the actual transaction can be done at a store near the buyer so that the product can be seen up close and physical before it is purchased.
source: GoogleCommerce via AndroidCentralw