Competition inward the Food Business

Agustus 06, 2017
A immature Mark See amongst a client at Sutton Place Gourmet , circa 1990.

xxx years agone almost to the 24-hour interval , I moved to Washington DC to accept a chore amongst United States of America of America Patent in addition to Trademark office. While living inwards Alexandria Virginia , I met at swain named Mark See who was working at a gourmet nutrient store called Sutton Place Gourmet.

This was inwards the era earlier Whole Foods in addition to other upscale eateries.  Granted , New York City had its Balducci's.  And Central New York had its Wegmans , although perchance Wegmans wasn't quite every bit upscale dorsum in addition to thence every bit it is today.

Working inwards retail is a vicious line of piece of job concern , in addition to Mark would pass threescore hours or to a greater extent than a calendar week every bit managing director of the Alexandria store.  Sutton Place was a local chain amongst branches on New United Mexican States Avenue , Bethesda , in addition to other locations.  It was Whole Foods earlier Whole Foods. They had exotic in addition to unusual items for sale in addition to everything was a trivial to a greater extent than expensive or a lot to a greater extent than expensive than the local grocery store.  At the fourth dimension , I was working at the Patent Office in addition to going to schoolhouse at nighttime to larn my police describe degree.  So similar most 20- or 30- somethings , nosotros were real busy.  Thus , Mark would purchase nutrient in addition to supplies at Sutton Place using his household charge.

Although he received upward to a 40% discount on items he purchased at the store , it was yet real expensive to store there. They deducted his household accuse from his paycheck , in addition to on to a greater extent than than i occasion I was chagrined to come across that his pay stub had a negative publish on it.  We were living whole paycheck long earlier Whole Foods always existed.

We had a give-and-take close this in addition to nosotros decided that for everyday staple items nosotros should discovery this house called Safeway.  So nosotros made it a signal i 24-hour interval a calendar week see Safeway or Giant to purchase staple items similar newspaper towels in addition to whatnot.  We also bring together the BJ's Wholesale Club every bit good every bit Costco. However I'm non certain that the Wholesale Club actually helped amongst our spending habits , every bit nosotros were tempted to purchase a lot of impulse items in that location - in addition to did.

Eventually , Mark got burned out , left the retail line of piece of job concern in addition to became a Real Estate agent.  You don't come across a lot of quondam white-haired people working inwards grocery stores , fifty-fifty gourmet grocery stores -  nor arrive at y'all come across a lot of quondam white-haired people working inwards law firms other than the senior partner in addition to he's just i guy.

Since those days , much has changed , Balducci's ended upward buying out the Sutton Place chain in addition to re-branding it.  However they stimulate got a lot to a greater extent than contest inwards the cast of Whole Foods in addition to Trader Joe's every bit good every bit ordinary grocery stores moving upscale.  Walmart got into the nutrient line of piece of job concern since in addition to thence in addition to is in all likelihood the largest grocery chain inwards the United States of America of America , today.

Along the agency , our prejudices in addition to preferences regarding grocery stores stimulate got changed.  When nosotros lived inwards key New York , nosotros loved to see Wegmans , every bit their grocery store experience was akin to that of Sutton Place , although slightly cheaper.

However nosotros start to tire of Wegmans' high prices in addition to atmosphere.  Everything was thence dark in addition to dramatic inwards there.  It began to experience a flake similar nosotros were beingness pose on past times the entire experience.  The store was ready similar a racetrack , much similar Ikea , thence y'all had to become from i destination to the other to larn anything. And they had quite a flake of pretentious nutrient items in that location including a vegetarian department that was by in addition to large candy in addition to cereal.  It was to a greater extent than than a trivial pretentious.

When nosotros moved to Georgia , nosotros started shopping at the Harris Teeter on St. Simons Island.  It was a long drive from our household to larn in that location in addition to patch they had a bang-up choice of upper-end foods , their prices were through the roof.  Publix , commonly a real well-appointed chain inwards Florida seem to stimulate got exclusively i dowdy store hither inwards Brunswick.

When the recession hitting nosotros started looking at alternatives. Winn-Dixie , a southern chain , was inwards the throes of reorganization in addition to started spiffing upward their stores in addition to offering bang-up products in addition to outrageously depression prices. Of course of written report I realized afterward on they did this to pose the stores upward for sale , which they eventually did.  I made a trivial coin buying their stock when it was sold to a competing chain.

The large alter inwards our lives was when nosotros showtime started shopping for nutrient at Walmart.  The recession hitting in addition to nosotros had to cutting dorsum on spending.  I started this blog.   We decided , i 24-hour interval , to become to Walmart , after a disappointing see to Publix.   We were expecting to discovery expired nutrient items in addition to dented cans of peas - every bit good every bit the "People of WalMart" y'all come across on YouTube.   But our prejudices were simply that - prejudices , in addition to empty-headed ones at that.

We discovered that Wal-Mart was the largest purveyor of organic foods.  Not exclusively that , they had a huge choice of foods , at bang-up prices.   We constitute items that were also at the "gourmet" stores , but for less than one-half the price.  It was an eye-opening experience.   We stimulate got friends that fifty-fifty today volition drive xx miles out of their agency to store at Harris-Teeter , in addition to pay double for groceries.   When y'all cite Wal-Mart in addition to the novel "Ghetto Gourmet" store (a "neighborhood market" at the corner of MLK in addition to Community boulevards) , they coil their eyes.  "I would never store inwards such a place!" they cry.

And at the same fourth dimension , these are liberal people who claim non to live racist or prejudiced.   But to store inwards the same store every bit dark people is , good , beneath them.  Limousine liberals - become figure.

Anyway , inwards the lastly few years , some weird things stimulate got been happening inwards the grocery business.   Prices are inwards free-fall.  Influenza A virus subtype H5N1 dozen eggs , which was over $2 a brace of years agone , is 79 cents today.  What is going on?   There is a lot of contest inwards the grocery line of piece of job concern , in addition to the contest is getting worse (or improve , depending on your signal of view) every bit to a greater extent than retailers move inwards the market.

Restaurants are fifty-fifty feeling the heat.  You tin flame purchase "pre-made" foods at the grocery store in addition to convey them habitation to serve , for a lot less coin than a eating theater meal.   Wal-Mart has a $4.99 rotisserie chicken that would feed 4 people (with side dishes) , in addition to comes pre-cooked.   Not exclusively that , every bit nosotros caput toward recession , a lot of people are waking upward in addition to realizing that maybe using a eating theater every bit your kitchen is a actually , actually stupid idea.


Whatever the ground , sales inwards grocery stores are upward , but prices are lower than ever.   Not exclusively has Wal-Mart rewritten the majority on grocery sales , unusual companies similar Food Lion , Aldi Nord in addition to Aldi Sud (one runs the Aldi chain , the other Trader Joe's , or maybe the other agency to a greater extent than or less , I forget).   And yet some other European grocer announced today they are entering the market.   The grocery line of piece of job concern is getting cut-throat.

Against this background , Whole Foods , similar Sutton Place , didn't stimulate got a chance.  The latest intelligence is , Amazon is buying the chain , to arrive at what , nosotros don't know.   I intend the thought of "upscale" or "luxury" grocery stores may live an thought whose fourth dimension has come upward in addition to gone.    Maybe in that location are a few people left who demand to pay 2-3 times the going charge per unit of measurement for groceries , simply thence they tin flame store inwards a store in addition to non come across misfortunate people.   But similar "luxury" cars , y'all stimulate got to wonder whether the raison d'etra has gone past times the wayside - when y'all tin flame lodge an economic scheme automobile amongst all the same features.

Why pay enormous sums for groceries when y'all tin flame become to Wal-Mart in addition to larn them for far less?   And it is non simply the "luxury" gourmet chains that are at jeopardy , but the middle-class chains every bit well.  I was inwards Winn-Dixie the other 24-hour interval in addition to called Mark in addition to asked if nosotros needed anything.  He told me to larn hamburger buns.   They are $2 a packet at Winn-Dixie.  88 cents at Wal-Mart.   I was chagrined.  But i time to a greater extent than , that's why nosotros stopped shopping at Winn-Dixie.   The mid-level middle-class grocery stores stimulate got the most to lose inwards this coming retail war.

But maybe Amazon has something else inwards mind.  As I noted earlier , Wal-Mart's wages over Amazon is that it is i of the few brick-and-mortar stores that I see anymore.  And I see it to larn groceries (which are a real difficult affair to lodge online - at to the lowest degree fresh create , cheese , meats , in addition to dairy) every bit good every bit prescriptions filled.   Wal-Mart also has an online shopping scheme similar Amazon's , in addition to offers discounted transportation to the store.   Since y'all become to the store anyway , why non stimulate got your items shipped there?   If they arrive at this correct (e.g. , non lose your shit) they could build clean upward amongst this model.

Maybe Amazon is thinking same affair - send your Amazon purchase to the Whole Foods , in addition to pick it upward there.   But I am non certain it was a smart move.   Unlike Wal-Mart , which is the novel Sears of today (you tin flame stimulate got your tires rotated patch y'all purchase novel jeans for the kids , stimulate got your eyes examined , cash a banking concern check , consume luncheon , stimulate got your pilus done , pay your taxes , sign upward for Obamacare , in addition to purchase groceries , all without leaving the store) , Whole Foods is a niche marketplace position histrion , selling overpriced nutrient to clueless yuppies who tending to a greater extent than close impressing their neighbors inwards Park Slope amongst the logo on their grocery handbag (you express joy , people used to inquire for the fancy grocery bags at Sutton Place , simply thence they could present off to others).

The fiscal press argues that Kroger is where the Whole Foods customers are fleeing to.  And maybe this is true.  It fits the designing nosotros made when the recession hit.  We dropped the high-end grocery store in addition to went to a mid-level store , in addition to and thence finally Wal-Mart.   Wal-Mart wins inwards the destination , non Kroger.   Whatever the novel designing volition live , I suspect in that location volition live a lot of shakeout inwards this industry.   You can't hold selling products for below cost - similar eggs for 79 cents a dozen , at to the lowest degree non for long.

And this recession , I intend volition displace a lot of younger people to alter their buying habits permanently.   Realizing that the ground they are living "paycheck-to-paycheck" has to a greater extent than to arrive at amongst their spending habits than who is inwards the White House , they may build profound in addition to permanent changes inwards their shopping style.   At the same fourth dimension , older folks are hitting retirement historic menses in addition to realizing they stimulate got to cut back their budgets.   Throw inwards a mild recession in addition to also many players inwards an overheated marketplace position in addition to , good , we'll come across a pretty neat toll state of war inwards the grocery line of piece of job concern inwards the side past times side few years.

And who arrive at y'all intend volition live the lastly human standing?   I know where my bets are placed.

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