Politics & Prejudices
The Whole truth
That $5 million spent luring Whole Foods drives city’s independent grocers crazy
Published: May 16, 2012
There was a fair amount of excitement in the press and, presumably, yuppieland, when ground was broken this week for Detroit's first-ever Whole Foods Market, at Mack and John R.
Some of the coverage was positively breathless. Wow! Will wonders never cease? Whole Foods, which bills itself as "the world's largest natural and organic grocery store" is coming to Detroit!!!
How wonderful. Yes, at last poor Detroiters will be saved from the "food desert" in which they have been languishing. It was hinted that Detroiters will now be able to see and even buy lettuce, tomatoes and oranges for the first time in their lives. That is, if they can survive scurvy until the store actually opens next year.
That's a little exaggerated, but there's been a lot written that would give you the impression that unless Detroiters can somehow get themselves to Royal Oak's Holiday Market, they are now doomed to spend their lives eating nothing but overpriced and likely expired cans of tuna and spaghetti from the shelves of their local party store.
Well, guess again. The other day, I once again heard the assertion that Detroit doesn't have a single supermarket.
That kind of thing drives the Detroit Independent Grocers Association crazy. Know how many full-service grocery stores there are in the city? (By full-service, I mean at least 10,000 square feet of aisles, and dedicated meat, dairy, produce and frozen food sections.)
Eighty-three. That's right, 83. "Our members are the grocers who are truly committed to Detroit," Eric Younan told me. He is director of strategic initiatives for the Chaldean-American Chamber of Commerce, the parent group of the grocers' association.
While most of those stores are Chaldean-owned, not all are, Younan told me. They are truly small, independent operators; while a few people have more than one store, there are 53 different owners.
They include University Foods over by Warren and the Lodge Freeway; two Glory Supermarkets, and lots of others; there is a complete, easy-to-navigate list at mydetroitgrocers.com.
"You know, our grocers are the people who have remained loyal to the city. Most of them have been around for 30 years or more, serving communities that chain stores have long ago abandoned," Younan said, after conferring with John Loussia, who heads the grocers' association. "Many of these stores are in underserved communities, such as Farmer John's at Gratiot and Harper and Pick & Save at Seven Mile and Van Dyke," he told me.
"Think national stores will open in these neighborhoods?"
What bothers the independent grocers is not that Whole Foods is trying to come in to Detroit. The independents acknowledge that they have every right to do that. What the independents hate is that Whole Foods is getting millions of dollars in incentives to do so, when they get nothing.
According to an analysis by Crain's Detroit Business last year, Whole Foods asked for more than $4.2 million in federal, state and city incentives before opening a Detroit store. They also planned to apply for brownfield incentives. All told, the Chaldeans put the final price of luring Whole Foods to Detroit at close to $5 million. Michigan and Detroit development officials had no comment.
Eric Younan says we've seen this movie before, "time and time again. A name brand chain store is provided with significant tax incentives to open within city limits."
After a short time, "the store fails and is ultimately purchased and run successfully by an independent grocer (usually Chaldean) sans credits, abatements or incentives of any kind."
The problem, Younan explained, is that many of those in the communities they serve are dependent on assistance checks. They shop when the checks come early in the month. But for the last two-thirds of each month, business falls off. That doesn't work for the chain stores, he said. "Our members have been able to discover creative ways of coping with that and staying in business."
However, aren't these small grocery stores vastly overpriced, compared to the big chains? Younan acknowledged that for some items that can be bought in enormous quantities, such as Campbell's canned soups, you'll see cheaper prices in chain stores.
But he challenged me to walk the aisles of a few independents and compare a wide range of prices, and check out the produce.
Much of the fresh meat and produce in many of them comes from Eastern Market and the efficient Spartan Foods chain. Besides, he asked me, does anyone think Whole Foods prices are cheap?
He makes some compelling arguments. But the Detroit grocers' own website admits that one-third of the money city residents spend on food is spent in the suburbs. One Saturday afternoon a few years ago, I saw three Detroit council members separately shopping at Royal Oak's aforementioned Holiday Market. Why is that, if the city has so many great grocers? Younan paused.
He's never been a grocer himself. But as a boy, he used to go help his father, a butcher at a small market in one of the city's toughest neighborhoods back in the '70s and '80s.
> Email Jack Lessenberry