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Compare prices between a Dollar General in a poor neighborhood and a walmart. One of those is going to be 30% higher (even more on some things). Supermarkets ha
by hajile 8y ago
Compare prices between a Dollar General in a poor neighborhood and a walmart. One of those is going to be 30% higher (even more on some things). Supermarkets have a net profit of 1-2%. If walmart could charge 30% more for the same thing, they'd build in poor neighborhoods every time. They don't because the risk is too high when a store a couple minutes away offers lower overhead, lower prices and lower risk. Walmart tried this with walmart express then killed most of them off (keeping some larger neighborhood markets in better neighborhoods) because they weren't turning a profit.
https://www.forbes.com/sites/greatspeculations/2016/01/22/walmart-kills-walmart-express-are-neighborhood-market-stores-more-productive/#22f03c3524c5 https://www.forbes.com/sites/greatspeculations/2016/01/22/wa...
Companies like Whole Foods are not typical of grocery chains. They will go wherever their niche is located. That would be like complaining there aren't Swiss watch stores on every corner. There is something to be said for branding and location, but even Walmart with their "
- iguy 8y agoYou're making a lot of different claims here. You may be right about insurance etc, although the rent will be lower too... but I think there are much simpler explanations for why some things are more expensive in the shops in poorer neighbourhoods. Staff are a big expense anywhere, and if they spend their time on $10 purchases instead of $100 purchases, then the margins have to be higher. That's basically why Costco is cheaper than 7/11. Isn't this just the same thing?
- deleted 8y ago[deleted]