How One Grocery Chain Succeeds In Low-Income, Underserved Communities

05/15/2015 04:12 pm ET | Updated May 18, 2015
Brown's Super Stores/Facebook

Successfully operating a for-profit grocery store in a “food desert” -- that is, a low-income rural or urban area with few or no options in the way of fresh, healthy and affordable food -- can prove challenging. Yet one regional chain of stores in the Philadelphia area appears to be doing just that.

As NPR’s Maanvi Singh reported Thursday, Brown’s Super Stores, which owns and operates 11 ShopRite supermarkets in and around Philadelphia, has made it a mission to sell healthy, affordable and appealing food in underserved neighborhoods. The stores employ a combined 2,300 associates.

That mission appears to be working as, according to NPR, the chain's stores in low-income areas are profitable.

Jeff Brown, the founder, president and CEO of Brown’s, explained to NPR that the stores have made a particular effort to reflect the interests and backgrounds of the communities they serve, working in partnership with community leaders from the start. Stores in areas with higher Muslim populations, for example, offer halal meat in a separate department.

The stores also double as neighborhood hubs, featuring community rooms that can be used by local groups for meetings and events, as well as on-site credit unions, health clinics, social workers and staff nutritionists, NPR reports. Most of the services are free.

The chain's efforts to benefit the community also extend to its hiring practices. Brown’s makes an explicit effort to hire ex-offenders to work in its stores, partnering with a workforce training organization to help screen job seekers who might be a good match for the company, PolicyLink’s Sarah Treuhaft wrote in a 2012 blog entry for The Huffington Post.

“When you know the challenges the people who live in these communities face, they’re so happy that somebody is giving people a second chance,” Sandy Brown, Jeff Brown’s wife and the chain’s co-owner, explained last year to The Times Herald, a Pennsylvania newspaper.

Brown's appears to have excelled with its business model, and in 2009, Jeff Brown launched a nonprofit organization called UpLift Solutions in a push to help other grocers succeed. Still, the industry is full of struggling businesses.

Grocery stores tend to operate on small profit margins, and it's not clear whether many other grocers will be able to find success serving populations like the one Brown's focuses on. Small grocery stores often rely on higher markups in order to stay profitable, and some stores intended to serve food deserts have struggled to remain competitive with their pricing and ultimately shuttered.

Still, a number of other chains, big and small, are also taking steps to address the issue. And some grocers have been given extra incentive to move into grocery-poor areas thanks to public-private partnerships like the Pennsylvania Fresh Food Financing Initiative, which kicked in start-up funding for Brown’s.

Whole Foods is planning to open a store next year on a long-vacant lot in Chicago’s struggling Englewood neighborhood. The company has been so happy with sales at its first Detroit store that it has plans for another. The Chicago store and the existing Detroit store have each received lucrative tax incentives, to the tune of $10.7 million and $4.2 million respectively.

This week, regional New York chain Wegmans also announced plans to open a supermarket next to a public housing project in Brooklyn’s Fort Greene neighborhood, an area that for now lacks fresh, affordable food options.

According to the U.S. Department of Agriculture, an estimated 23.5 million Americans, almost half of them low-income, currently live in census tracts that qualify as food deserts.

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