Grocery stores squeezed by new competition

The now defunct Keyfood in Windsor Terrace Brooklyn.

Neighbors and local activists have plastered one of the walls of the store with stickers.

Outside the old Keyfood. Almost 5,000 area residents have signed a petition pledging not to shop at Walgreens when the store opens next year.

Connie Thompson’s apartment in Brooklyn looks just like a grandmother’s. It’s got the squishy chairs and sofas, wall-to-wall carpeting and it’s very, very quiet. Thompson is 67 and she is a grandmother -- of five. Normally she likes to cook for her family, but lately she’s been forced to make some changes, like buying instant mashed potatoes in a box.

“I don’t know if I like them,” Thompson says.  “I bought the flaked potatoes so I don’t have to go out and buy regular potatoes.”

For the past 30 years Thompson shopped at her local grocery, a Keyfood that sat just a couple of blocks away. It was an easy walk and Thompson could bring her push cart -- but in June the Keyfood closed. Like many of her Brooklyn neighbors, Thompson doesn’t have a car and the only other supermarkets around are at least a mile away, too far for her to carry potatoes on foot.

Her son, a construction worker, works long hours and only has one day off (Sundays) to run his own errands and get things done around the house. And Thompson’s daughter has given her mom rides to the store, but Thompson doesn’t want to be a burden. So, for now, she says she feels stuck. 

“I have emphysema, and I have asthma," she says. "So for me for to walk up the hill, it’s a hardship for me. And then you have to figure, if I don’t do that, I have to take the bus.  So now it’s costing me money.

The Keyfood closed when its longtime owner retired and moved to Florida, but not before he leased the space to a Walgreens. According to Brad Lander, the area’s councilman, Walgreens was the highest bidder on the space, beating out interested grocery stores. The lot is a large one, a big corner location with a parking lot -- a rarity in this part of Brooklyn. 

John Stanton, a professor of food marketing at St. Joseph’s University says the old truism of location, location, location helps to explain what Walgreens is so interested in.

“Well, when you’re looking for sights there’s a couple of very highly rated attributes," he explains. "One is being on a corner, and the second is having a big parking lot.”

According to Stanton, pharmacy chains like Walgreens are eating into the turf that used to belong only to grocery stores. If you look at the shelves in the local branch of a national pharmacy chain you’ll probably notice they’re selling more food -- but in the process, Stanton says, they’re muscling small grocers out.

“There’s no longer supermarkets that everybody likes a little," he says. "There are only supermarkets that somebody likes a lot.”

Think specialty stores like eco-friendly, organic-focused Whole Foods or your local Italian market. While the margins on groceries are much lower than on health and beauty aids,  pharmacy chains like Walgreens  stock them because they want to lure you in, according to Stanton. As consumers, we shop for food more often than soap or shampoo.

For now, Windsor Terrace remains without a grocery store -- at least until Walgreens opens next year -- and maybe beyond. The company says it’s working with a grocer, but its plans aren’t yet clear. Still, John Stanton says there may be hope for the neighborhood.

“If it’s attractive to Walgreens, it’s probably going to be attractive to other people.”

Consumers would welcome that in the future. But for now in Windsor Terrace, it’s still a trek to the grocery store.

Sally Herships: Connie Thompson’s apartment in Brooklyn looks just like a grandmother’s. It’s got squishy chairs and sofas  - wall to wall carpeting and it’s quiet. Thompson is 67 and she is a grandmother - of five. Normally she likes to cook for her family, but lately she’s been forced to make some changes.

Connie Thompson: I don’t know if I like them.   I bought the flaked potatoes so I don’t have to go out and buy regular potatoes.

For the past thirty years Thompson shopped at her local grocery, a Keyfood – just a couple blocks away. But in June it closed. Like many of her neighbors Thompson doesn’t have a car and the only other supermarkets here are too far for her to carry potatoes on foot- at least a mile away.

Thompson: I have emphysema and I have asthma. So for me for to walk up the hill. It’s a hardship for me. And then you have to figure, if I don’t do that, I have to take the bus.  So now it’s costing me money.

The Keyfood closed when its longtime owner retired and moved to Florida. But not before he leased the space to a Walgreens. According to a local councilman Walgreens was the highest bidder. And it beat out grocery stores for the space.   It’s a big corner location with a parking lot. A rarity in this part of Brooklyn.

John Stanton: Well, when you’re looking for sights there’s a couple of very highly rated attributes.

John Stanton teaches food marketing at St. Joseph’s University.

Stanton: One is being on a corner. And the second is having a big parking lot. 

He says pharmacy chains like Walgreens are eating into the turf that used to belong to only to grocery stores. If you look at the shelves in your local,  national, pharmacy chain you’ll probably notice they’re selling more food. In the process they’re muscling small grocers out.

Stanton: There’s no longer supermarkets that everybody likes a little. There are only supermarkets that somebody likes a lot.

Think specialty stores like Whole Foods or your local Italian market. Of course the margins on groceries are much lower than on health and beauty aids  but pharmacy chains like Walgreens  stock them because they want to lure you in. We shop for food more often than soap or shampoo. For now, Windsor Terrace remains without a grocery store – at least until Walgreens opens next year. And maybe beyond. The company says it’s working with a grocer, but its plans aren’t yet clear. John Stanton says there may be hope for the neighborhood.

Stanton: So, if it’s attractive to Walgreens, it’s probably going to be attractive to other people.

Good news for the future. But for now it’s still a trek to the grocery store. In Brooklyn, I’m Sally Herships for Marketplace.

About the author

Sally Herships is a regular contributor to Marketplace.

The now defunct Keyfood in Windsor Terrace Brooklyn.

Neighbors and local activists have plastered one of the walls of the store with stickers.

Outside the old Keyfood. Almost 5,000 area residents have signed a petition pledging not to shop at Walgreens when the store opens next year.

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