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In Philadelphia, a fourth-generation supermarket owner has gone where others have feared to tread: food deserts, low-income neighborhoods that have no direct access to a real grocery store. The small chain has given these communities a place to get nutritious food, health services and maybe most important, hundreds of new jobs. Economics correspondent Paul Solman reports.
Now a look at food deserts, underserved communities that lack access to fresh food.
Economics correspondent Paul Solman examines how one grocery store chain has devised a different business model to address the problem.
It's part of our weekly series Making Sense, which airs every Thursday on the "NewsHour."
Fourth generation Philadelphia supermarket owner Jeff Brown is a hands-on CEO.
JEFF BROWN, President and CEO, Brown's Super Stores: Is everything all right?
With customers and employees alike.
Mr. Brown has just showed me some things that I can get better in.
Brown has become renowned for doing the seemingly impossible. He operates seven profitable stores in food deserts, low-income neighborhoods where supermarkets have long since feared to tread.
Bus driver Kevin Griffin thought it can't happen here.
We have been waiting for this a long time in this area.
This area is the Nicetown-Tioga section of North Philly, known for its shuttered factories, not its supermarkets, since there hasn't been one here in over 20 years.
Lonea Cameron's family has lived here much of that time.
This is the first place that has been so well-stocked. The produce, the meat, everything is so fresh.
This property was an abandoned, unappetizing Tastykake plant until grocer Jeff Brown came around.
When we looked at the real estate to come here, there were no other interested parties.
Others saw the lone and level sands of the food desert. Brown saw the chance to build an oasis.
I saw 75,000 people with no grocery store.
But how to succeed in a business that traditionally lost about four cents on every dollar's worth of sales? By really trying, trying everything, going for tax breaks, government and foundation grants, even getting a new bus stop in front of the store.
Public-private partnerships like these offset costs by about 2.5 cents for every dollar of sales. Add an extra 2.5 cents, and you wind up with a 1-penny profit margin, like most supermarkets. Brown makes that extra 2.5 cents by catering carefully to local tastes.
I think this is an interesting example of our business model. Understand our customers come from the South. They like sweet potatoes. Figure out the right items. It's like half of the bakery business in this store.
Religiously sanctioned meats for the neighborhood's many Muslims.
This is halal meat room. It's a completely separate meat room. And the imams in the area have been involved with the selection of our vendors.
Imported ingredients for its immigrants.
Fufu flour is big among Western Africans.
Brown's mantra, if you stock it, they will come. And there's another motivation here as well, health via nutrition.
If you don't have it, they don't come here. They don't come here, they don't benefit from your fresh foods.
Like produce, bountiful here, rarely if ever found in the desert.
Since lower obesity and less diabetes are the goals, there's fresh seafood. Instead of fried chicken, Brown's house grilled is heavily promoted, and thin-sliced beef, because it fills the plate, cut the calories, cuts the cost.
This is a $10 challenge. We're going to stretch $10 today.
An on-site nutritionist, Ruby Dee Davis, demonstrates how to eat well cheaply.
RUBY DEE DAVIS:
Oh, we're in luck today. Cabbage is 69 cents a pound. So this is something that you can choose a nice cabbage, probably about two pounds or more, and you will be able to stretch your dollars that way. Let's look at the bananas. The bananas are 59 cents a pound.
Of course, her lessons are up against a host of distractions.
Employment issues, just not having enough money to buy food. They're dealing with grandchildren, taking care of them. They're just dealing with a lot of other issues, and they just feel like nutrition is not at the top of their list right now.
But the store is trying to put it there.
How long have you had this?
Oh, like three days.
There's also a walk-in clinic where the uninsured can see a nurse practitioner for $20, with just a short wait, can access an on-site pharmacy.
So, one other person in your household is claimed by you, right?
An in-store social worker helps customers apply for public benefits.
There's even a credit union with no minimum deposit on your account, free check cashing, instead of the typical high-fee alternatives in low-income neighborhoods, and a low-cost bill payment service.
But what's most important to the community, says Democratic ward leader Mark Green, are the 300 new jobs here.
MARK GREEN, Ward Leader:
This location has provided full-time employment for a lot of guys. It changes your life because now you have gainful employment. You can provide for your family, you can take care of your children, you can support your wife, you can pay your rent. You don't have to sell drugs. You don't have to be on the corners anymore. You won't become over-sentenced.
ANTHONY JACKSON, Employee:
This was my first shot, my first job ever. I never had a job before.
Forty-one-year-old Anthony Jackson spent half his life in jail.
ANTHONY JACKSON, Frozen Foods Manager:
I have been incarcerated for numerous crimes, drug possession, firearms violation. I had a lengthy criminal background past. I couldn't get a job anywhere. I tried to get a job at a Wendy's, a McDonald's, fast food restaurants. Nobody gave me a call back.
But Brown did. Six years later, Jackson is now a frozen foods manager making over $50,000 a year.
I'm not the same guy I used to be. I'm off of parole. I'm off of probation. All's I do now is work. So, I'm trying to climb this ladder of success.
But really? Success, when so many of the jobs are low-wage?
MARK GREEN, Democratic Ward Leader:
This is a stepping-stone. This is not going to solve all the problems. It's an entry-level position. It provides employment. It does fill a void, but it's not the total answer.
Nor is it the total answer when it comes the nutrition.
In fact, according to a study published last year in "Health Affairs," the opening of a supermarket in another Philadelphia food desert didn't lead to changes in fruit and vegetable intake or lower body mass index. But it wasn't his store, and Brown is undeterred.
The customers in this area had no way to buy any produce at all before. And now we sell the same amount of produce we sell in a suburban store. So I would have to believe their diet has changed, because they're not rich people. And if they allocated their resources more towards fresh fruits and vegetables, I would think their diet changed.
And in America's food desert, says Brown, there are a lot of not-rich people going unserved.
I think we're short about 1,000 supermarkets. There's 25 million people that live without a grocery store today, and they don't have a practical means to get to one.
Of course, Brown isn't the only retailer to see opportunity in the desert. Whole Foods is expanding into inner-city Detroit and Chicago, while Wegmans plans to open next to a Brooklyn housing project.
Stop in and try some today.
The problem is, the profitable food desert supermarket can turn out to be a mirage. Baltimore's Apples & Oranges fresh market went bust in just two years.
A lot of times, it's inexperienced entrepreneurs, so they're not accustomed to running a food business at all. They're just trying to do something good. And the other thing is, you can't tell people what to eat and you can't open up a store and sell all healthy food, because nobody eats like that, or very few people eat like that.
You have to have some sweet potato pie?
That's right. You're right.
So, in the end, give the community what it needs, whether it be food or a job.
I'm proud of you.
This is economics correspondent Paul Solman, reporting for the PBS NewsHour from a Philadelphia food desert, where a supermarket chain is making at least part of it bloom.
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