Shawn MacDonald, Pitney Bowes Business Insight
Pork. The “other” white meat or a “four-letter” word? Merriam-Webster’s Online Dictionary defines as:
1. the fresh or salted flesh of swine when dressed for food
2. government funds, jobs, or favors distributed by politicians to gain political advantage
Meateaters and vegetarians can both agree that the second definition leaves a bad taste in your mouth.
Admittedly, I opposed the government stimulus bill passed earlier this year because it seemed fraught with funding for “pet projects” so legislators could return to their districts and prove how hard they have been working for their constituency. And I do mean “pet” projects such as $2.5 million for a waterfront duck pond park and $200,000 for a dog park in Hercules, California or $16.5 million to save the San Francisco Bay area habitat of the salt marsh harvest mouse. While these may be very worthwhile causes, how many jobs will be created?
However, I have just discovered a stimulus-funded success story that you can sink your teeth into, literally! That’s right, I am talking about food here. As reported by Supermarket News, a 55,000-square-foot Stop & Shop grocery store will be the focal point of Arverne by the Sea, a mixed-use development in the south Queens community of Rockaway Beach. This development will be funded in part by $5.5 million in tax-exempt bonds made possible through the federal stimulus program. This Stop & Shop will not only fill a retail void – an estimated $528 million in consumer spending is lost annually to competing retail centers outside the Rockaways – but could also create upwards of 175 jobs as well.
The once-thriving waterfront community was designated as an Urban Renewal Project in 1964, and is emblematic of the decay within many urban communities throughout the country. The loss of the retail sectors within these communities have long been a challenge for local authorities. Urban consumers do have money to spend, accounting for $122 billion in retail sales in 2005. However, research also indicates a $42 billion “retail gap” still exists within urban communities, the majority of which can be attributed to the lack of supermarkets. To underscore this last point, more than half of the Detroit residents have to travel twice as far to find a grocery store than a fast-food restaurant.
While there are true impediments to closing the retail gap (scarcity of developable land, restrictive zoning, infrastructure, and politics), grocery chains must also overcome some powerful myths associated with doing business in these underserved areas. These myths include the closure of other local businesses, rampant crime, local residents will not get majority of jobs, and the need for special subsidies to ensure survival.
The Great Atlantic & Pacific Tea Company’s (A&P) Pathmark banner embraces inner-city opportunities, and in the early 1990s formed a partnership with the New Community Corporation to develop a 44,000-square-foot supermarket in the Newark, New Jersey Central Ward. Due to years of pent-up demand, this store set sales records on its first day of operation and within 2 years became Pathmark’s most profitable store. Hopefully, Stop & Shop will find similar success at Arverne by the Sea.
The stimulus package could have been another tool used by local authorities to recruit supermarket operators to underserved areas. Given all of the negative press surrounding the stimulus bill, it is comforting to find a truly “stimulating” story among the $787 billion appropriation. No doubt, a lot of “pork” was doled out in the stimulus bill, but did you know that the Pilgrim’s Pride Corporation received $70,000 to deliver 80,000 pounds of frozen chicken during July 2009 creating zero jobs? Now, I gotta “beef” with that!!
