Kroger makes unusual donation to prevent a food desert
A single grocery store going out of business in an otherwise under-served area can cause big problems for a community. Recently in South Memphis, TN, Kroger made an untraditional move in a market to make sure a community it was leaving wasn’t stuck without a place to shop for food.
In the aftermath of a February store closure in Memphis’s Orange Mound neighborhood, Kroger began working with community groups to find a tenant to purchase the space, according to Newsweek. The chain reached out to 30 businesses, but could not find one that could afford the $500,000 building. In late September, Kroger donated the building to a competitor, eight-store regional chain Superlo Foods, so that the neighborhood would not be without a grocery store.
Lack of a willingness from other retailers to purchase the space was attributed to the location’s inability to produce the kind of margins a traditional grocery needs to survive. A 2015 study states that some of the zip codes in Memphis constitute the country’s poorest areas. Nearly 200,000 people in Shelby County —where the Orange Mound neighborhood resides — live in food insecurity.
This is not the first move Kroger has made to address the problem of food deserts. Earlier this year the chain announced the launch of Zero Hunger Mobile Mart in Louisville, KY. The Mobile Mart is a single-aisle grocery store on wheels that visits low-income neighborhoods, housing complexes, senior living centers, parks and community centers where groceries are not otherwise easily available. The 50-foot refrigerated trailer makes two stops daily.
Other retailers, startups and nonprofits have tried to address the issue of food deserts from various angles.
Kroger’s move in Memphis comes as customers nationwide have become more conscious of issues of corporate social responsibility and big businesses have begun to respond in some surprising ways.
The Business Roundtable, a lobbying group composed of CEOs of the country’s biggest companies, recently changed its corporate governance principles to reflect a responsibility on the part of corporations to “all stakeholders,” rather than just shareholders.
- Kroger Donates Empty Store to Competitor to Stave Off Food Desert – Newsweek
- Kroger’s trucks roll into food deserts – RetailWire
- Government incentives for food deserts – RetailWire
- Is Walmart’s CEO the right leader for Business Roundtable? – RetailWire
DISCUSSION QUESTIONS: How important is it for grocers and other retailers to take into consideration the impact of leaving a community? Do you see any benefit to Kroger in the case discussed in the article?