Grocery stores don’t have a lot of margins, so this move won’t reduce prices by much or at all. What it will do is improve low income areas the “market” has left alone to improve the availability and quality of nearby food. I’ve heard a lot of people skeptical of the “lower prices” part, when I think the food desert part is a much more important part of the plan tbh.
One thing to also note, is that grocery margins are tight after they give shareholders and c level staff hundreds of millions of dollars. In other words, if you’re not intent on making a profit and distributing that profit only to billionaires and friends, there’s plenty of space to subsidize costs even before accounting for tax breaks (which probably net even) and controlled rent factors.
People shouldn’t get wealthy off selling groceries while people go hungry.
That’s where rent control and tax breaks come in, as well as scale if you’re opening multiple stores. I’m not aware of a large non profit grocery chain.
Low margins because they’re expected to have returns equal or better than alternative investments. If they drop below that, then its not worth running a grocery store and you might as well liquidate and put your money where it will make higher returns.
If you don’t care about that, or can even run on a slight loss with some taxpayer subsidies then you can make the food a lot more affordable.
They have low margins because they have high costs (like rent, logistics and insurance stuff), so if those get reduced then they can lower prices by exactly that amount while keeping the same margin.
That makes sense, but it does mean the private grocery stores won’t lower their prices in response. So unfortunately it won’t have as good of an effect as affordable housing can have, but still a positive one where these are created.
Grocery stores don’t have a lot of margins, so this move won’t reduce prices by much or at all. What it will do is improve low income areas the “market” has left alone to improve the availability and quality of nearby food. I’ve heard a lot of people skeptical of the “lower prices” part, when I think the food desert part is a much more important part of the plan tbh.
It could be subsidized. In that case you could easily save money over retail stores.
Note that some grocery items are sold below cost at retail stores as part of a loss leader strategy (milk for example).
One thing to also note, is that grocery margins are tight after they give shareholders and c level staff hundreds of millions of dollars. In other words, if you’re not intent on making a profit and distributing that profit only to billionaires and friends, there’s plenty of space to subsidize costs even before accounting for tax breaks (which probably net even) and controlled rent factors.
People shouldn’t get wealthy off selling groceries while people go hungry.
Not all grocery stores are corporate owned and they still have thin margins.
That’s where rent control and tax breaks come in, as well as scale if you’re opening multiple stores. I’m not aware of a large non profit grocery chain.
Low margins because they’re expected to have returns equal or better than alternative investments. If they drop below that, then its not worth running a grocery store and you might as well liquidate and put your money where it will make higher returns.
If you don’t care about that, or can even run on a slight loss with some taxpayer subsidies then you can make the food a lot more affordable.
They have low margins because they have high costs (like rent, logistics and insurance stuff), so if those get reduced then they can lower prices by exactly that amount while keeping the same margin.
Not to mention spoilage
And presumably, higher wages can be included in the formula as well as lower prices.
That makes sense, but it does mean the private grocery stores won’t lower their prices in response. So unfortunately it won’t have as good of an effect as affordable housing can have, but still a positive one where these are created.