Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

NYC to open municipal grocery store in 2027

grocerydive.com

Post reply on HN
Print view View original

111–120 of 191 posts

Re: NYC to open municipal grocery store in 2027

#111

Post by scoofy »

rdtsc wrote: post #80

> “Some will insist that city-owned businesses do not work, that government cannot keep up with corporations. My answer to them is simple: I look forward to the competition. May the most affordable grocery store win,” Mamdani said. Well it's interesting enough to try. Are they going to keep the stores open at a loss, that's not really competing then, is it? If they sell things that are much cheaper, restaurants could…

It's a question of volume. If they're really going to sell things at a loss, then it should create real demand. If you have that demand, then you're going to start running out of groceries mid-day. At that point, the business sucks because you either have to show up at 10 AM to buy anything, or they start some ridiculous rationing program to prevent people and businesses effectively reselling at market rates, or they make up for their negative margins by increasing their volume and losing even more money.

It's a low margin, high volume business. I'm extremely skeptical that this plan works beyond just being a politically popular way to light money on fire. I say that as someone who actually like Mamdani.

Re: NYC to open municipal grocery store in 2027

#112

Post by halflife »

WalterBright wrote: post #21
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 Seattle, the proposal for a government grocery store included exemption from paying property taxes and rent.

So they have an unfair advantage over the competition.

Or it’s just a way to neutralize the ineffectiveness of the management, since it’s not profitable based, who’s going to be fired?

Re: NYC to open municipal grocery store in 2027

#113

Post by [deleted] »

ceejayoz wrote: post #100
SpicyLemonZest wrote: post #94

Earlier quoted context omitted.

You can't conclude it was a ruse without knowing the elasticity of egg demand! This is ultimately the kind of thing that worries me about a municipal grocery store. Will voters allow it to respond in rational ways to market conditions, or will they expect the city to go out and extort some egg suppliers when market prices rise above what they consider reasonable?

The DOJ thinks it was a ruse. https://www.reuters.com/legal/government/us-egg-producers-fa... As did a jury: https://apnews.com/article/egg-producers-price-gouging-lawsu...

[deleted]

Re: NYC to open municipal grocery store in 2027

#114

Post by asdff »

halflife wrote: post #92
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.

That may be, but you can direct subsidies towards inverse relation to the store’s income. You can even add extra taxes for large chains. But as others said, groceries are working on minimal margin. And all of them work with the same wholeselles (except those with vertical integrations), and this is a nation wide problem.

>That may be, but you can direct subsidies towards inverse relation to the store’s income. You can even add extra taxes for large chains.

Not really imo. Private market passes costs to consumers and leverages subsidy offers to achieve rat race outcomes out of competing local governments off each other. It is how you end up with the classic case of a city courting some business but offering enough tax abatement where the city isn't actually getting anything out of the business, and once the abatement expire the business just leaves for somewhere else that will cut them a better deal. City ends up hostage to the business demanding ever more favorable incentives and removal of all taxes (there's been free trade zones established in the middle of ho hum suburbs, stuff brought in there doesn't even count as imported to the US).

Re: NYC to open municipal grocery store in 2027

#115

Post by halflife »

thinkingtoilet wrote: post #32
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?

Oh no! Struggling Americans will be able to buy food cheaper! What will we do? Also, if anyone has any reservations about a government run grocery store, go ask your representatives to come out against military commissaries. I bet you will not be able to find one active politician who will try to remove that. You know why? Because government run grocery stores work. End of story. Period. There is no discussion. You a…

Grocery costs has to come from some formula. If the mamdani stores actually do sell at a lower cost, where did the discount come from?

Re: NYC to open municipal grocery store in 2027

#116

Post by miketery »

ceejayoz wrote: post #51
miketery wrote: post #41

Earlier quoted context omitted.

Yeah it was so successful that people would line up around the block for bananas the one time a year. Or when boots came into the store you'd pick up whatever size you could, as you'd trade later. (true stories)

Again: > The USSR has tried this. Lets not. would rule out things like "going to the moon" or "building roads". It's a pretty useless rubric. I am not doubting the USSR fucked all sorts of things up. I'm doubting that that inherently means those things must be impossible.

Updated - since my text was confusing. The subject at hand is subsidized grocery stores, the USSR is an example of failed centrally planned subsidized grocery stores.

Re: NYC to open municipal grocery store in 2027

#117

Post by [deleted] »

kennywinker wrote: post #72
fortran77 wrote: post #39

Earlier quoted context omitted.

It also doesn't seem fair to compete against stores that have to pay rent and taxes.

A gov run grocery store will have to pay rent and taxes. The only difference is it doesn’t have to make profits to pay its owners. The question is, why are you prioritizing being “fair” to people profiting off hunger, over being fair to working people trying to eat? Even if it is “unfair” this is a kind of unfair we should all support (assuming it succeeds at feeding people).

[deleted]

Re: NYC to open municipal grocery store in 2027

#118

Post by SpicyLemonZest »

ceejayoz wrote: post #100
SpicyLemonZest wrote: post #94

Earlier quoted context omitted.

You can't conclude it was a ruse without knowing the elasticity of egg demand! This is ultimately the kind of thing that worries me about a municipal grocery store. Will voters allow it to respond in rational ways to market conditions, or will they expect the city to go out and extort some egg suppliers when market prices rise above what they consider reasonable?

The DOJ thinks it was a ruse. https://www.reuters.com/legal/government/us-egg-producers-fa... As did a jury: https://apnews.com/article/egg-producers-price-gouging-lawsu...

It could potentially be a ruse by egg producers. Certainly there's reason for suspicion. But darth_avocado's claim was that grocery stores were in on the ruse and must have extracted huge profits from price gouging consumers. I think that's obviously false. You'll note that in the jury case the plaintiffs were themselves megacorporations, and substantially larger ones than the producers they were suing at that.

I don't blame consumers for deciding they don't care about the underlying market structure and just want cheap eggs. But you can't run a store on that basis, and if the city feels like it has to there'll be problems.

Re: NYC to open municipal grocery store in 2027

#119

Post by gruez »

asdff wrote: post #93
gruez wrote: post #84

Earlier quoted context omitted.

>Annual gross profit for Kroger is $34b. What's the point of this observation other than for shock value? Yes, when you multiply small percentage by a huge number, you're still left with a huge number. That doesn't mean it's suddenly worth doing unless you can make the argument that it scales easily.

It represents the privatized waste figure out of your grocery bill that is not going to the food you are bringing home.

See my previous comment:

>That doesn't mean it's suddenly worth doing unless you can make the argument that it scales easily.

Otherwise it's like saying "you know what everyone should do? Raise their own chickens! Sure, you might be only saving $1 or whatever a day, but multiply that 365 days per year and 340 million Americans, and that's billions we're all collectively saving!"

And no, running a grocery store isn't something that scales easily.

Re: NYC to open municipal grocery store in 2027

#120

Post by halflife »

bherms wrote: post #90
ceejayoz wrote: post #36

Earlier quoted context omitted.

> The USSR has tried this. Lets not. The USSR tried lots of things we do successfully. This is actually something governments have a proven ability to do, at least in some contexts, without becoming a corrupt boondoggle. https://en.wikipedia.org/wiki/Defense_Commissary_Agency

My fil owns a bunch of grocery stores in Russia. The gov't still essentially subsidizes the cost of basic goods to keep prices low for the poor. Because of this, even the poorest have access to what they need, and they worship Putin because of it - "he makes sure we're taken care of". Obviously we could get into the corruption, why they're so poor in the first place, etc, but it is clearly working pretty well.

Also in Israel, stable basic products (like milk) have a government mandated pricing, not even subsidized. It’s a good idea in its simplistic form, and works well most of the times, but once every 2 years you get a crunch where the manufacturers just decline to produce products at a loss, so we don’t have milk or butter for 2 weeks.
Post reply on HN