Grocery Stores

When I was home, my dad and I talked about the grocery store he has worked in for the last thirty years. It is failing. Harris Teeter opened up on the other side of town, and business is down by at least 25 percent. Management (I guess I should say ownership) which he is part of has made a push to be a "local" business. They have tried to highlight their local vendors and their local products. They have put their old employees in the local paper. They have adopted a retro-hippie localvore our-town-first strategy.

I thought the strategy was foolish. I thought it was fake. Grocery stores by there very nature cannot be local businesses. They do not make fruit loops or grow bananas in Virginia. It is impossible. If you want to be a grocery store, you have to be a global business. Of course most customers don't see it this way. Some people think that buying from a local "mom and pop's" is somehow better than buying from Harris Teeter.

Now, the strategy also fails on practical grounds. The majority owner does not live in town. One of the old guys has never lived in town. My dad has lived in town his whole life but works too much to really be involved in town politics or even the volunteer fire department. He also believes that business success ultimately depends on providing value to customers. In other words "being local" is not a reason in itself to shop at the grocery store. Business is about reducing transportation and transaction costs (having locational monopoly power) and providing better and/or cheaper products.

I guess it gets back to doing what you think is right, and going with it. But I still worry about the store, and I don't like the fakeness of their marketing campaign. I would prefer them to concentrate on providing value to customers.