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NYC to open municipal grocery store in 2027

grocerydive.com

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Re: NYC to open municipal grocery store in 2027

#101

Post by wahnfrieden »

gruez wrote: post #14
asdff wrote: post #5

Earlier quoted context omitted.

Major grocers are more inclined to form cartels on price than to engage in organic competitive action. These businesses are too large and incentives too perverse for free market dynamics to apply anymore.

>Major grocers are more inclined to form cartels on price than to engage in organic competitive action. Even if we take at face value that this is happening, their margins are famously low (ie. low single digits[1][2]) that any improvements are likely negligible. In the best case scenario where they're run as competently/efficiently as a normal grocery store, but don't take any profits, you'd be saving like 50 cents…

The consumer cost of overcharges from price-fixed bread in Canada was estimated at 4-5 billion dollars. And that's just bread. Is that negligible?

Usually if someone steals a millionth of that, they go to jail for a very long time.

The same players are now under investigation for selling underweight meats.

Re: NYC to open municipal grocery store in 2027

#102

Post by halflife »

yohannparis wrote: post #7
halflife wrote: post #3

This sounds extremely non economically viable. The municipality which has monopoly on land taxes and costs will compete with stores that must pay taxes and rent? Won’t it just cause neighboring stores to close? Won’t a better option be subsidizing taxes for grocery stores, and let the discounts competitively pass unto the customers?

Why does everything needs to be economically viable?

Not everything does - transport infrastructure, healthcare, sewage, for example do not.

But economic viability -> competition -> research and development -> economic growth

Re: NYC to open municipal grocery store in 2027

#103

Post by gruez »

ceejayoz wrote: post #91
gruez wrote: post #89

Earlier quoted context omitted.

From your own article: >In 2024, DeCA estimated that it saved patrons $1.58 billion and had an operations cost of $1.7 billion, $1.5 billion of which was funded from appropriations.[8] Isn't this the "selling $1 for 75 cents" business model (aka moviepass) that people made fun of a few years ago?

Sure. It's also the business model of your local library.

Well no, because the library is often the sole provider of book lending services and there's no private sector alternative. The same can't be said for grocery stores. To continue your analogy, it would be closer to the government setting up its own streaming service, even though there's netfilx and several other competitors. Even though people hate netflix for its price hikes or whatever, it's unclear how the government can do a better job here than netfilx (or other competitors), aside from strongarming/expropriating rights holders.

Re: NYC to open municipal grocery store in 2027

#104

Post by asdff »

b112 wrote: post #82
ceejayoz wrote: post #63

Earlier quoted context omitted.

I'm a firm believer that part of progressivism needs to be reining in these sorts of NIMBY obstacles.

Environmental assessments are NIMBY? Well regardless, the point is it should be the same for everyone.

The whole point is in principle these things are good ideas but in practice they are tools weaponized by NIMBYs. This is the fig leaf that keeps them around. "But why would you do away with environmental review???" As if you were to stab 55 gal drums of toxic waste and dump them into a river. But really you were trying to build an apartment as large as many other existing apartments in the middle of the city. Or in this case, install something on the sidewalk.

Re: NYC to open municipal grocery store in 2027

#106

Post by halflife »

ceejayoz wrote: post #18
halflife wrote: post #3

This sounds extremely non economically viable. The municipality which has monopoly on land taxes and costs will compete with stores that must pay taxes and rent? Won’t it just cause neighboring stores to close? Won’t a better option be subsidizing taxes for grocery stores, and let the discounts competitively pass unto the customers?

> This sounds extremely non economically viable. Many things government does are not economically viable. That's why they get left to government. > Won’t it just cause neighboring stores to close? The idea is to build these where that has already occurred.

Of course, there is a term called coercive monopoly. It exists especially in large infrastructure projects where the startup cost is tremendous so only government, or a single entity without the possibility of competition can enter.

Groceries are not one of these. If you have a problem of high grocery costs, there are many better ways to tackle that other opening a government owned store. But it does make for a great photo op.

Re: NYC to open municipal grocery store in 2027

#107

Post by ceejayoz »

gruez wrote: post #103
ceejayoz wrote: post #91

Earlier quoted context omitted.

Sure. It's also the business model of your local library.

Well no, because the library is often the sole provider of book lending services and there's no private sector alternative. The same can't be said for grocery stores. To continue your analogy, it would be closer to the government setting up its own streaming service, even though there's netfilx and several other competitors. Even though people hate netflix for its price hikes or whatever, it's unclear how the governm…

> To continue your analogy, it would be closer to the government setting up its own streaming service…

https://www.pbs.org/

Re: NYC to open municipal grocery store in 2027

#108

Post by halflife »

bojan wrote: post #53
koolba wrote: post #11

Earlier quoted context omitted.

Because that’s what has traditionally allowed western countries to have a wide availability and inventory of goods vs communist economies.

But why does the availability have to be wide? Maybe those stories can do few things, but do them well. Sell staple foods and healthy choices.

Because than people won’t come to your store. People buy where they can purchase the maximum of their shopping cart in a single place.

That is why you have loss leader grocers, where they pull people with dramatic discounts on specific items, but the total cart costs the same

Re: NYC to open municipal grocery store in 2027

#109

Post by asdff »

wahnfrieden wrote: post #101
gruez wrote: post #14

Earlier quoted context omitted.

>Major grocers are more inclined to form cartels on price than to engage in organic competitive action. Even if we take at face value that this is happening, their margins are famously low (ie. low single digits[1][2]) that any improvements are likely negligible. In the best case scenario where they're run as competently/efficiently as a normal grocery store, but don't take any profits, you'd be saving like 50 cents…

The consumer cost of overcharges from price-fixed bread in Canada was estimated at 4-5 billion dollars. And that's just bread. Is that negligible? Usually if someone steals a millionth of that, they go to jail for a very long time. The same players are now under investigation for selling underweight meats.

The whole egg fiasco is as far as I am concerned the biggest proof of price gouging cartel behavior there is. And people assume it is normal.

Vast majority of product sold when inventory is low, they just go out of stock still at MSRP right to the last sku in the inventory. Then, you wait until more are available, also at that same price.

Really, why would prices go up for the eggs in this situation if not for gouging? Sure plenty of chickens were culled. But the remaining chickens aren't costing more than they did before the cull. Whoever is producing the remaining eggs being produced is producing them for the exact same overhead they have always been producing. Feed is still probably the same. Maybe cheaper with an excess of feed on the market needing to be sold and moved out of feedlots before the next crop comes in, from the chicken culling your competitors were doing. Water is still probably the same. Power is still probably the same. Staff are still getting the same pay. Property taxes are still the same. Really, who is getting the $10 from the $12 dozen of eggs? Probably some guys smoking cigars if we are being honest.

Re: NYC to open municipal grocery store in 2027

#110

Post by halflife »

wahnfrieden wrote: post #6
halflife wrote: post #3

This sounds extremely non economically viable. The municipality which has monopoly on land taxes and costs will compete with stores that must pay taxes and rent? Won’t it just cause neighboring stores to close? Won’t a better option be subsidizing taxes for grocery stores, and let the discounts competitively pass unto the customers?

In some neighborhoods there are only luxury grocery options. Groceries also form cartels as the other commenter mentioned. The biggest grocers in Canada did it for many years until they were penalized for it (though it’s likely still continuing in other ways - the same players are now under investigation for selling underweight meats) The estimated cost to consumers from bread price-fixing was $4-5 billion

It’s about supply and demand. Luxury grocers provide a shopping “experience”, where low cost grocers do not. In a luxury neighborhood it would make sense the shoppers are looking for experience more so than low cost.
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