Supermarket shortage
Supermarket shortages have been identified in many American urban neighborhoods, and such gaps in food access have been closely correlated with diet-related diseases such as cancer, obesity, and diabetes.
[5] In 2006, US grocery stores typically had only 1% to 2% profit margins,[6] so the difficulties involved in running an urban supermarket are often seen as too costly in an already-risky business.
[citation needed] A 2007 study suggested that urban stores must stock a variety of lower-volume items geared to multiethnic tastes.
A 1998 study found that chains tend to develop a formula that works for their core market, which consists of middle-class, white suburbanites.
A 1999 study by the Initiative for a Competitive Inner City in Boston, found that "nearly 8 million people who live in the nation's poorest urban communities have a combined $85 billion in retail spending power, which is far greater than all of Mexico.
[9] A 1998 study stated that the media portrays urban areas as poor and dependent, contributing to supermarket executives' skepticism.
The study stated that urban areas usually consist overwhelmingly of working households with a substantial share of middle-income people.
A 2006 article stated that the expense and scarcity of land in urban environments poses some of the greatest problems for supermarket developers.
This means that urban supermarkets can sell significantly fewer products than suburban stores, which contributes to lower profits.
[10] A 1998 study suggested that by engaging with local organizations, supermarkets can create a link with a community that will contribute to security, a reduction in shrinkage, and provide for better selection and effectiveness of employees.
[1] A 1998 study suggested that stores keep in mind the shopping habits of urban consumers, who often rely on monies distributed to them at the beginning of each month.
[12] Many cities and states across the US have recognized the urban supermarket gap problem, and have developed plans to address the issue of food access.
[13] The initiative provided more than $400 million in funding from the Treasury Department, USDA and Department of Health and Human Services, to promote expanding access to nutritious foods, including developing and equipping grocery stores and other small retailers to sell healthful food in low-income rural and urban communities that currently lack this option.
In April 2003, Pennsylvania passed the nation's first statewide economic development initiative aimed at improving access to markets that sell healthy food in underserved rural and urban communities.
Neighborhoods such as Central and Spanish Harlem and Washington Heights in Manhattan; Bushwick, Bedford Stuyvesant, East New York and Sunset Park in Brooklyn; Corona, Jamaica and Far Rockaway in Queens; areas of the South Bronx, Williamsbridge/Wakefield and portions of Pelham Parkway in the Bronx; and St. George and Stapleton in Staten Island show the greatest need for full-line supermarkets.
[23] In Oakland's flatlands, the development of low-income communities, lowered real estate values, zoning restrictions, land parcel sizes and property taxes discouraged supermarkets and other full-service food retailers.
In 2005, Chicago’s planning department provided an information guide with a database of suitable land parcels to executives at a grocers’ expo.
"[10] A 1998 study stated that executives’ fears of security costs may be easily abated: Rochester clinched the deal with a Tops supermarket, by offering to locate a police station at the development site.
