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A man feeding a remote Alaska town with a Costco card and a ship
- joncp 6y agoThe scarcity of flour, especially bread flour piques my curiosity. I haven't heard about anyone eating vastly more bread than before the quarantine. It's just that everyone is making it at home instead of buying it with meals at restaurants. One would expect the flour not being shipped to the restaurants would be redirected into the retail supply chain but that doesn't appear to be the case. The only explanations I can see are: 1) People are still panic-buying flour even after they've settled down about toilet paper, 2) everyone is secretly gorging themselves on bread, 3) the supply has dried up, or 4) there's some vast and growing stockpile of unsold bread flour in the wholesale supply chain. None of these explanations ring true to me, so where's the flour going?
- renewiltord 6y agoI imagine it's folks like me who are baking now for no good reason but to pass the time. I previously didn't eat any bread. Now I'm getting fat.
- dorchadas 6y agoI concur. I've made three loaves of bread and two pies during all this, and will likely make another loaf this week. Just because I want something to do and wanted to learn how to bake more. I had to get yeast shipped to me from a friend out of state though, as it was already gone here.
- rootusrootus 6y agoOne trick that worked for me was to look for fresh yeast. Everyone thinks of the packets of dry yeast, but forget that in the refrigerated section there will be some fresh yeast. I was able to find that long after all the dry packets were gone. Also, try making sourdough. Have to make the starter first, but after that you're set. Or get yeast from other sources, like dried fruit and such. Yeast is everywhere!
- MattGaiser 6y agoEveryone is buying a mega bag thinking that they will now suddenly do a lot of baking. My mother did this. My grandmother did this. Many of my 23 year old friends did this. They end up baking one loaf and then just forgetting about it in the pantry, but they bought a 20 lb bag because of how much they expected to bake.
- SECProto 6y ago> Everyone is buying a mega bag thinking that they will now suddenly do a lot of baking I normally go through a 5kg bag of flour every month or two, just baking some breads and cakes occasionally. So far, I've gone through almost 20kg of flour in 6 weeks. And I know many others who are baking much more than usual That said, mine is mostly a couple loaves of bread every 3 days substituting a couple bread products from the grocery store every 2 or 3 days. So not causing extra demand for the ingredient, just a different format (i get my flour by the 5 to 10kg bag, the grocery store that normally does my baking likely gets theirs in ...slightly larger volumes)
- bluedino 6y agoSo where are all the 2lb bags then?
- Scoundreller 6y agoWhen the cheaper 20lb bags sell out, people buy the 2lb bags. My guess is that more production is for the 20lb bags, and the 2lb bags usually sat on the shelf longer.
- deleted 6y ago[deleted]
- ascorbic 6y agoUsually domestic sales in small bags are a tiny fraction of the amount sold in large bags to commercial users. When consumption switched to home use then those small bags sold out quickly. The small bags are still there in the supply chain, it's just that the demand has gone through the roof so it's hard to find them.
- tyleregeto 6y agoInteresting article about this, one of Canada's biggest flour suppliers has not run out of flour, but rather bags to put it in. https://www.cbc.ca/news/business/robin-hood-flour-baking-yellow-bags-1.5541483 https://www.cbc.ca/news/business/robin-hood-flour-baking-yel...
- dlgeek 6y agoConsumer flour and commercial/industrial flour are apparently different enough that they can't easily redirect the latter into the former's supply chain.
- cyphar 6y agoThe most likely explanation to me is (4) -- but it's because flour (et al) producers are struggling to get their flour into the consumer supply chain. Shipping goods to businesses is quite different to shipping it to consumers -- businesses order in bulk and (to be frank) don't care as much about trivial things like packaging or minor product differentiation. Compare the giant packages of cheese and cured meat at your deli counter to the small individually wrapped packages you get elsewhere. Costco is the exception here (their entire business model is to buy things wholesale, from the business supply chain). Most grocery stores can't stock 12.5kg bags of flour because they don't have enough space on their shelves, not to mention that in their view most consumers would be put off by a lack of choice (even if it means that products are in stock).
- pengaru 6y agoOn what planet does anybody pivot to eating home-baked bread without consuming substantially more of it?
- Retric 6y agoThe comment is about total bread consumption, not home-baked bread consumption. Home bakers and factories are both using the same basic ingredients, so why can’t supply chain’s easily swap? And the simple reality is they use different bags for transport and factories to fill the bags. Thus it’s a bag problem not a flour problem. PS: What’s so interesting about the shutdown is it exposed so much about the supply chain that’s normally hidden. It feels like debugging some third party API has a bug, except on a much larger scale.
- Scoundreller 6y agoI think the joke is that people that start fresh baking bread at home start eating a lot more of it because it’s delicious.
- pengaru 6y agoNot only is it delicious, your home smells like a bakery with every fresh loaf and who can resist a fresh loaf of bread still warm?
- mattigames 6y agoSpecialy given making bread better than the store is very likely, my father used to be a baker and has told me how stores use a yellow coloring to make it look like bread has lots of eggs but it has near none, or how they push yeast to the limit where bread gets the most air inside possible to make it look big, or how they buy the cheapest butter and so on.
- Scoundreller 6y agoIn Canada, the reality is that all the butter is the same anyway. All churned to 84% by the dairy board. Centralized production...
- phil21 6y agoI've looked into this, and it seems pretty much down to the retail vs. commercial packaging and the assorted supply chains. Both the packaging materials themselves, as well as the plant capacity to pack a bunch of 5lb bags of flour vs. giant 50 or 100lb bags a baker would pick up. I'm sure FDA labeling requirements/etc. are likely different as well so it's not quite as simple as "find a few trucks worth of burlap bags". One thing I've done is found a local restaurant supply store and had a friend with a business tax ID add me to their account (account is setup to actually charge sales tax so it's all good there). At these places, very little is in shortage - plenty of flour to be had of all types they typically stock. The only shortages I've noticed have been in chicken at the moment, and of course PPE. Everything else seems quite well stocked for the time being. The downside of course is that when you want to buy some chicken thighs, your minimum order qty is 40lbs. But I started a co-op buying group with my friends in the neighborhood and just spend some time splitting things up into usable quantities. It's come in handy for stuff that is hard to come buy in the grocery stores or costco like chocolate chips. Of course, the minimum qty of those is 25lbs so we had to divy quite a few up! The cost savings are absolutely astronomical on a per-unit basis for most staple items. I've also noticed at least at my local costco they have started to get "alternative" sources redirected from the commercial supply chain. Such as 50lb bags of rice in plane white nylon bags with a sticker slapped on it. This seems to support the theory that packaging (both material and labor) is the bottleneck for retail staple goods. Add in all the waste of every 23 year old who has never baked in their life buying 20lbs of flour to go bad in their pantry and things.
- bigiain 6y agoProbably because traditional supply chains are awful when they encounter anything except super predictable demand. https://en.wikipedia.org/wiki/Beer_distribution_game https://en.wikipedia.org/wiki/Beer_distribution_game I'm guessing the retail supply chain and their wholesalers are a pretty much seperate business and supply chain to the restaurant industry, and a jump in demand for home baking (even if that's probably mostly just going onto household pantry storage) has pushed the traditional supply chain into instability. Pretty much the same story for toilet paper too. It's not like people need to wipe their arses more in isolation, but the retail market and the business/workspace market supply chains are now flailing around looking for a new barely stable ordering/stocking equilibrium.
- notyourday 6y ago> . One would expect the flour not being shipped to the restaurants would be redirected into the retail supply chain but that doesn't appear to be the case. So I have friends that are reasonably known restaurateurs who obviously shut down their restaurants. I was talking to them about the logistics and the issues with the supply chain. It was rather eye opening to me. TL;DR : the problem with the supply chain is that the restaurants pay more for ingredients wholesale than what the public is willing to pay retail. We do not have a product shortages -- we have excessive amount of perishable product that was offloaded at excessive markup to restaurants/cafeterias/schools/etc. I'm in NYC - I can still walk into a regular grocery store in Queens/Brooklyn ( non Whole Foods ) and get chicken quarters from Perdue for $0.59-$0.89/lb. I can get a tomahawk steak for $14.95/lb (the chefs were shocked), a whole salmon (whole) imported from Canada, received today for $6.95/lb. I can get 10 lb onions for $4.95. Leg of lamb (whole) is $4.99/lb Restaurants pay 20-30% more than these prices as the baseline to Baldor or Sysco. I guess that 20-30% slippage does not matter for the restaurant when it is charging 4x-5x of the raw cost per plate.
- chii 6y agoi find it hard to believe that restaurants pay more than retail for the same goods.
- notyourday 6y agoYou can create an account on most of the restaurant supply services and place pre-paid orders. You would be shocked at the pricing ( there would be a minimum order value as well )
- smnrchrds 6y agoWhy do they do it then? Why won't they simply buy retail?
- deleted 6y ago[deleted]
- madengr 6y agoFlour isn’t the problem now, it’s yeast. Fortunately my mother in law traded us a few packs for an old iMac, so my daughter can now make pizza dough. Joking aside, we did give her an iMac, but you can’t find yeast anywhere.
- unexpected 6y agoif you have enough flour, we got around this problem by making a sourdough starter.
- jefftk 6y agoI've been buying instant yeast at a restaurant supply store for $5/lb, decanting into 8oz Mason jars, and selling it to neighbors. Something like 5lb so far.
- dredmorbius 6y agoI'm about 2 months and a couple of dozen loaves into sourdough starter. Excellent results.
- makeset 6y agoShe can make those packs go a LONG way, given enough rising time, with superior flavor to boot. E.g. the pizza dough with poolish in Ken Forkish's book "Flour Water Salt Yeast" uses 0.4g dry yeast per 1kg of flour.
- deleted 6y ago[deleted]
- Spooky23 6y agoRetail flour is the issue. You can get a 50 lb bag pretty easily, and honestly if you are going to use more than a few supermarket bags of flour, you could throw half away and still be ahead financially.
- jerry1979 6y agoBusinesses may have trouble mixing commercial and consumer lines of flour. Commercial kitchens may get large bags of flour delivered, and the system in place supports those kitchens on a lean inventory basis. Grocery stores may not feel comfortable stocking flour packaged for commercial kitchens. Selling 20 pound white-box-looking flour does not look attractive in grocery stores.
- jefftk 6y agoCommerical 50lb bags of AP or bread flour are still easy to get here in Boston. I organized a group buy to hit the minimum order for a supplier https://www.jefftk.com/p/organizing-a-group-buy-of-flour https://www.jefftk.com/p/organizing-a-group-buy-of-flour
- fredophile 6y agoMy guess is that more people are baking at home. If you look at a family of four you could have gone from two working parents with both children in school to one or both parents at home along with both children. They may not have had much time for baking before. Baking is a useful task since it provides food and can occupy the children if you get them involved. A batch of cookies and some bread or buns every week will substantially increase a household's flour use. This is partially offset by less commercial baking. However, commercial bakeries buy huge packages of flour and not the smaller bags available in grocery stores. The supply chain needs time to transition to this change in demand.
- brohee 6y agoPackaging issue I think. Bakers have no trouble finding any, and in my city at least one baker took the opportunity and resold floor in paper bags (at pretty absurd markup).
- andrewaylett 6y agoA UK supermarket has taken to bagging up flour in-store, as a way to bridge the gap between available supply (commercial quantities) and demand (consumer quantities): https://www.independent.co.uk/life-style/food-and-drink/morrisons-buy-bags-flour-bread-baking-shortage-yeast-lockdown-a9496506.html https://www.independent.co.uk/life-style/food-and-drink/morr...
- gnopgnip 6y agoIs it really scarce, and how would you measure that objectively?
- bluedino 6y agoThere's a video of a grocery trip in Alaska, the prices are insane. https://youtu.be/3TVlmmVqgnQ https://youtu.be/3TVlmmVqgnQ
- jrockway 6y agoSome of the prices were insane, some of them are exactly what I pay at my grocery store in Brooklyn. $7.99 for a block of cheese? Yup. But as the weight/volume increases, their prices skyrocket where wight/volume doesn't seem to matter at all here. Obviously that's where the cost comes from. What is interesting is how similar the extremes are. In the middle of nowhere, the cost of the product is dominated by shipping. In the center of modern society, the cost is dominated by rent. It's only when you go out to the suburbs, probably one of society's least efficient constructions, that you see the lowest prices -- a perfect balance of efficiency, I guess. It is weird and I wonder if there's some lesson in here.
- so33 6y ago> It's only when you go out to the suburbs, probably one of society's least efficient constructions, that you see the lowest prices -- a perfect balance of efficiency, I guess. It is weird and I wonder if there's some lesson in here. I suspect the inefficiencies are just externalized! Rent is low because land is cheap(er) in suburbia, but society pays in increased average travel times* as well as the high costs of road infrastructure needed to support suburban living in general, which is paid for in our taxes and thus doesn't show up on the price tag at the store but rather as a line item on our paychecks. * I can walk less than five minutes to the grocery store in the urban core. Admittedly I have no data on this but based on my own experience, I'd bet it takes the average suburban household at least 10 minutes to drive to a grocery store - and 20-30 minutes to drive to a Costco-like store, placed where rent is even lower - and then 2-3 minutes on average spent looking for parking and then walking across the parking lot! Time is money, and given society's obsession with optimizing time, I find it strange how little attention we truly pay to travel times.
- toast0 6y ago
- Marsymars 6y agoI visited Dawson City in the Yukon last year and was surprised to see Kirkland Signature goods on sale at the general store. Didn't think to ask how they got there.
- grecy 6y ago(I live in the Yukon) It's extremely common to zip down to Juneau to go shopping and then hop back to the Yukon. It's just a 10 hour one way trip, and when you live in the North that's not so far. Tons of people go there simply to go to Costco (which doesn't exist in the Yukon) It's also really nice to go in winter when it's -40C/F in the Yukon (all inland) and usually right around freezing in Juneau (coastal)
- 9nGQluzmnq3M 6y ago> It's just a 10 hour one way trip Spoken like a true Canadian. (Edit: Oops!)
- grecy 6y ago<clears throat> Yukoner. The Yukon is in Canada.
- Scoundreller 6y agoHeh, as a Canadian living in the city, I often buy Kirkland brand allergy pills and ibuprofen off EBay from the US because it’s cheaper.
- greenyoda 6y agoFor those who are unfamiliar, "Kirkland Signature" is Costco's private brand.
- markdown 6y agoAnd very good Vodka, apparently due to being produced in a former Grey Goose distillery.
- Havoc 6y agoNice read - enjoyed that.
- dx87 6y agoThat's actually how a lot of businesses in rural parts of Alaska work, even places that don't require a boat or plane to access. My dad lives right off the highway in a small town in Alaska, and the closest thing to a grocery store is an old airplane hanger that one of the locals runs a general store out of. The owner makes weekly trips to Costco, which is ~4 hours away, and buys as much as they can fit into a big U-Haul, then resells it at their store. The selection is pretty limited, but they take requests throughout the week and will try to fulfill them on the next trip.
- Scoundreller 6y agoRural Croatia too, except it’s a truck that comes to all of the villages 3x/week with staple items. Plays ridiculously stereotypical Croatian music through a loudspeaker to announce his arrival. And then a meat truck once a week and a fish truck more irregularly. Took requests as well. I think of it like villages having Amazon Prime starting in the late 90s.
- koyote 6y agoThat's interesting! I would have thought Croatia to be small enough to not need such a system; i.e. supermarkets not further than half an hour drive away. Or is it just a matter of convenience?
- pinkorchid 6y agoA very similar system is also common in small towns (population in the low hundreds or fewer) in Spain. Every few days a baker will come driving their van and selling bread, or a truck with fruit, etc. Even doctors and priests follow a similar pattern. It's likely that one could drive for 30 minutes and find an even better selection. That assumes car ownership and the ability to drive, which is not widespread in the aging population in rural areas.
- solotronics 6y agoMy first reaction is that this is sad but that is incredibly biased based on my expectation of having anything on demand.
- momokoko 6y ago> Parker did some work around town, scrounged together $3k, and began taking a state-subsidized ferry to Juneau, where he bought Costco inventory to resell in Gustavus at a small markup. > As the store grew, Parker and his father launched their own freight company, purchased the town’s gasoline station, and bought two of their own ships — a $300k “insurance policy” that gave Parker tighter control over the supply chain in case of an emergency. I feel like they left out a step between $3k and a frieght company with 2 ships.
- taneq 6y agoMoving inventory on the existing ferry service and selling it at a profit?
- rosstex 6y agoA small loan of a million dollars.
- ashtonkem 6y agoOccasionally ships can be had for extremely cheap when the former owner cannot afford the maintenance on it. It's more common with small pleasure craft, but I wouldn't be surprised to hear about small cargo ships being occasionally abandoned up there.
- nine_k 6y agoIndeed: even if you get a ship for free, the crew is not free. Unless you're a certified captain already, you probably can't just operate the ship yourself. Also, now you have to pay for maintenance, fuel, mooring, loading and unloading cargo, etc. I suspect that $3k is not sufficient to start and sustain such an operation, so some steps are clearly missing. (Can't help but remember Grim Fandango, where a similar transition between a small-time sales agent and a ship owner is made by writing "one year later" across the screen.)
- cdepman 6y agoThanks for sharing - if anyone is interested in a great remote Alaska read (novel) - would recommend The Great Alone: https://kristinhannah.com/books/the-great-alone/ https://kristinhannah.com/books/the-great-alone/
- dntbnmpls 6y agoAlso, Proenneke's documentary "Alone in the Wilderness" is great too. https://en.wikipedia.org/wiki/Richard_Proenneke https://en.wikipedia.org/wiki/Richard_Proenneke
- jmspring 6y agoMy one trip to Molokai some 7 or 8 years ago. The main market had staples that were primarily split up bundles from Costco. So it seems like (given the other posts) a common model.
- ngcc_hk 6y agoOne of the problem is people do not pay for his overheads and insurance need. The town would not survive long by goodwill. Have to pay.
- DoreenMichele 6y agoThere's a slightly different version of this story with a much less snazzy title (weirdly, on the same site, it seems): https://thehustle.co/how-a-remote-alaska-town-gets-its-groceries/ https://thehustle.co/how-a-remote-alaska-town-gets-its-groce... (It's possible the writing is the same, but one has more photos?) I thought it was a gripping read. Neither title really does it justice. I have submitted it to r/CitizenPlanners because this one store is playing such a critical role to the welfare of the entire community and does so even under "normal" conditions. And these are not remotely normal conditions.
- deleted 6y ago[deleted]
- elipsey 6y agoNecessity is the mother of entrepreneurship. I grew up around there and bagged astoundingly large grocery orders for people coming in from the villages to shop. I also stayed in Gustavus at family friends homes, and even grew up with a kid named after the town. It's weird that I am reading this story from SF now. Just wanted to show up and rep the hometown/s.
- bung 6y agoGreat... now I have to re-watch Northern Exposure!
- ghaff 6y agoUnfortunately it's one of those series that you can't get the unaltered original because of music rights. (It's also pretty much a complete fantasy view of a small Alaskan town but it was a fun series in any case.)
- reagular 6y agoI would love operating a small ship for my groceries store rather than sitting in front of my computer all day.
- icebraining 6y agoWhat's stopping you?
- amelius 6y agoWrite a simulation game.
- dkdk8283 6y agoIsn’t this just another example of how businesses start? Hauling a trailer vs trucking in, storing, and managing stock. Seems like a smart move to keep overhead low.
- gambiting 6y agoOut of curiousity: >>One week, nobody wants whole milk; the next week, everyone wants 2% Do Americans call 2% whole milk? Around here full is 3.2% or even 3.8% of fat content
- chipperyman573 6y agoNo, we have fat free, 1%, 2%, and full fat.
- nightfly 6y agoNo, 2% and whole milk are different in America.
- gambiting 6y agoRight, it's just the way the author put it in the same sentence makes it sound like 2% is full fat.
- deleted 6y ago[deleted]
- supernova87a 6y agoIt's an impressive and respectable story of entrepreneurial behavior and solving a town's problems. But sometimes you wonder, some places just seem to not be suited for people to live self-sustainably in, because of location, population density, transportation networks. Maybe $12 milk is one of those signals.
- aasasd 6y ago> “The town might have a 100-gallon swing in demand for milk from one week to the next without any explanation of why. One week, nobody wants whole milk; the next week, everyone wants 2%.” IIRC it's a known phenomenon, but I can't remember the name right now. Buyers overestimate the demand, then the next cycle they have stock left, then again buy double because the shop might not have the thing next time. So the demand keeps swinging thereafter. In fact, the dude is sorta lucky since he can just ask everyone what they want, no need to guess from jumping numbers.
- phyzome 6y agohttps://en.wikipedia.org/wiki/Beer_distribution_game https://en.wikipedia.org/wiki/Beer_distribution_game
- aasasd 6y agoThat's exactly where I learned of the effect—the game was probably recently mentioned on HN. https://en.wikipedia.org/wiki/Bullwhip_effect https://en.wikipedia.org/wiki/Bullwhip_effect is the article specifically about the fluctuations. Come to think of it, apparently in the case of the Alaskan dude just one level of interaction is enough to summon the effect with 100% variation. I wonder what the Costco managers think of the picture on their end and whether they in turn order even more reserves.
- rd07 6y agoIt's interesting to see how the only grocery store in a remote place works. I've become interested in the story in another country, especially in my own country (Indonesia) an Asia generally. In some village in Papua, Indonesia, the logistics are supplied by small plane that visit regularly. The road infrastructure there is still bad, especially in the mountainous part of the island. And even if there are roads, it's safer to go by plane. Some small islands got their logistics by ship either once a week or once a month. And it really affected by the weather. Being an island country puts a challenging problem for Indonesia to distribute logistic to its people.
- ALee 6y agoAs I live and breathe - we're talking about ToshCo. I have shopped here, spent time in Gustavus, enjoyed the greatest July 4th celebration in the US here while climbing a grease pole. Funny thing is that not all the residents can buy stuff from ToshCo because it's more expensive, so they go to the local thrift store instead, aka Treasure store.