Success in Pennsylvania Stirs Hope for Food Deserts

Mar 15, 2010 12:00 PM, By MICHAEL GARRY


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Beginning last year, other states have begun emulating Pennsylvania's approach to food deserts, including New York, Illinois and Louisiana. More recently, Colorado and New Jersey have launched FFFI-inspired programs.

At the federal level, Weidman expects Congress to approve the White House's request for $400 million to address food deserts. “This has bipartisan support,” he said. “It's a 2-for-1, because you end up saving money on health care and creating lots of jobs.”

Bell ties the causes of the food desert issue to traditional modes of operating in the supermarket business. “Most national chains use a suburban format that needs a large number of square feet and lots of parking, which doesn't work well in urban settings,” particularly with the greater costs associated with cities, she said. The suburban format also doesn't translate well to rural areas with very low population density, she noted. Existing rural stores have also found themselves unable to make the capital investments needed to compete with new supercenters, said Weidman.

Both urban and rural retailers need an infusion of government support to transcend the intrinsic limitations of operating in these areas, many observers agree. But they hasten to add that the support is only to get over initial hurdles. “We don't believe it should be an ongoing subsidy,” said Bell.

In Pennsylvania and elsewhere, independent operators appear to be more proactive about entering food deserts than large chain operators. “Independents are more flexible with formats,” said Weidman. “Chains take a longer time walking up the ladder to make those decisions, but they are starting to be more interested.” Chains that are known for operating stores in inner cities include Pathmark and Fresh & Easy Neighborhood Market, which opened one of its small-format stores last month in South Los Angeles. “Chains are coming up with smaller formats that work in urban environments,” he noted.

TWO MODEL OPERATORS

In Pennsylvania, Brown, president and chief executive officer, Brown's Super Stores, Westville, N.J., and Burns, president and CEO, The Fresh Grocer, Drexel Hill, Pa., have become symbols for the success of the FFFI. Both recently garnered national attention for their efforts, with Brown chosen to sit with Michelle Obama during the State of the Union Address in January while Burns hosted the first lady at one of his inner-city Philadelphia stores last month. Brown also received the National Grocers Association's Entrepreneurial Excellence Award last month.

The experiences of Brown and Burns shed light on the challenges, complexities and rewards of selling groceries in the inner city.

As a member of the Wakefern Food Corp. wholesale cooperative, Brown, a fourth-generation grocer, operates 10 ShopRite stores, five in suburban areas and five in urban neighborhoods. Starting in 1988, he opened two suburban supermarkets and then a third that was a borderline urban/suburban store and “my first taste” of what running an urban store entails.

Brown kept opening suburban stores until six years ago when he attended a meeting set up by local non-profit groups to discuss how Pennsylvania “could help grocers fix this food desert problem,” he said. At the time, Philadelphia had the second-lowest number of supermarkets per capita of any major U.S. city.

Though other retailers left the meeting before the end, “out of curiosity, I stayed,” said Brown. Pennsylvania State Sen. Dwight Evans, Brown and a few others broke off into a smaller meeting. “He told me, “I want to solve this problem and the state wants to invest. There must be some way to do it.'”

Out of this discussion the FFFI was born. The state allocated $10 million (later to grow to $30 million) toward the food desert issue and Brown opened his first inner-city store on Island Avenue in southwest Philadelphia. “I wanted to try one store and stick our toe in the water,” he said.



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