So Mandani wants to have city run grocery stores.
Let’s say he gets his wish.
Grocery stores run about a 3% profit margin. This is for the big boys: Kroger, Safeway, HEB, etc.
The smaller chains have less buying power and can’t get the gross margins the big guys can so they run 1 to 2% profits. I don’t think NYC is going to get the same gross margin as Kroger.
Chain grocery stores employ a lot of younger, minimum wage people.
NYC stores will have to employ NYC city civil servants with all the benefits attached to being a city employee: Higher wages, gold plated health care, pensions, etc.
Pretty sure the 1% profit margin just left the building right there.
Then there is spoilage – because those folks living in the “Food deserts” aren’t going to be buying fresh stuff no matter how much the mayor says it is good for them.
Finally, as with anything related to NYC, there will also be a ton of graft and outright theft.
I predict the stores will run 20-30% in the red
This will be a HUGE debacle. But it might be fun to watch.
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Chemist said Finally, as with anything related to NYC, there will also be a ton of graft and outright theft. Indeed in a little city near where I live there was an excellent grocery store part of one of the larger New England Chains. It was brand new, had good prices, all sorts of products, including very high quality produce and types of produce (Jicama, Star Fruit, Mangoes, Plantain etc) rarely if ever seen in New England Grocery stores. After about 3-4 years of operation, the chain closed it. I happened to know a person who was a relative of… Read more »