That's a pity, because doing grocery shopping at CVS is like doing grocery shopping at a gas station / convenience mart: there's a $1-3 markup on damn near everything. And I imagine the people that are forced to shop at a drugstore are probably poor to begin with, so, that hits them even worse.
I think maybe urban stores might skew the stats a bit. There's so much demand for groceries within a short walk of all the local condo buildings that my local Walgreens has set up a fresh sushi counter. The cheaper, giant grocery stores are all located in low income areas where land is cheap, but there's 8 CVS, 5 7-Eleven, and 2 Walgreens within a quarter mile walk of where I live and work.
So when I run out of flour, I have a decision to make: would I rather sit in traffic for 30 minutes, wait for instacart/amazon fresh delivery, or go to CVS/Walgreens? I suspect there are many people like me who pay the markup every day because it's less of a hassle.
Well until SNAP[1] is blocked from being spent on snacks and sodas these sites will always be in use. The list of foods that are acceptable encourage these stores to focus on the high profit side of the list which equates to what many would see as pure junk.
Plus in some areas you cannot get a grocery in due to zoning or regulatory agencies which can increase the costs of worker and compliance needs beyond normal. There are many rules regarding handling of produce and raw foods that drug store type sellers never have to meet.
Where real estate is expensive the only grocery stores that can stay afloat are fat margin chains that cater to upscale customers. The poor people are then forced to shop at CVS or wherever, sure it's more expensive than Walmart or a proper grocery store but it's still cheaper than whole paycheck.
WF (or Trader Joes for that matter) simply doesn't sell value priced versions of a lot of items. CVS will sell it at a ripoff. It probably comes out close to a wash put poor people are poor, not stupid. If the numbers worked out in favor of WF they would be shopping there. Also, nobody(TM) does their entire shopping at CVS. People will drag their asses elsewhere on a regular basis to buy certain items that are cheap. Many convenience stores, bodegas, etc. will sell a couple staples or classes of items dirt cheap in order to attract business. You buy your regular items where they are cheap (e.g. $1.50/gal brand name milk from the bodega that buys about to expire milk from a restaurant supplier for pennies and passes on the savings to create foot traffic) and buy everything else at CVS.
CVS is has a high/low pricing scheme, so most of the items you see aren't being purchased at full price and people really only buy them on sale. You have to play their games with stacking ECB, coupons and sales though, so it's work.
I worked at CVS for years before moving overseas. It has been 5 or 6 years since I worked there. I worked at 2 different stores.
All sorts of folks buy from CVS, mostly stuff on sale but not always. Moms with a sick child and elderly folks in to get medicines are a good chunk of the customers. Folks without transportation are a few people, sure. In one store, some of the food traffic was simply because we were in a small town with limited groceries: Some of the food was nearly as cheap as the local places. We got a boost of traffic because of football games at a college about 25 minutes away.
The second store was a 24 hour store, and though the town had 24 hour grocery stores, they weren't next to us at night. We were not far from a small college as well. And again, same sorts of customers, usually picking up one or two things.
Even more extra bonus points on holidays, since we were always open (at both stores). I think people figured we'd be less busy.
Not in my experience. I have both a CVS and a normal grocery store (a Morton Williams) across the street. CVS beats the grocery store on milk price (e.g. Horizon) by ~$0.50/gal and on breakfast cereal (e.g. Cheerios) by ~$1.
Whole Foods 365 brand organic milk is slightly cheaper than CVS, but it's a slightly longer walk and has longer lines and is in a basement, so I tend not to bother. (I probably should go there more often.)
This is a matter of scale. The more interesting metric would be a per-store figure, where TJ and WF outsell CVS by a factor of 5–7x.[1] I'm surprised that it's not higher.
> The eyebrow-raising figure probably comes down to an issue of scale – last year CVS and Walgreens each had close to 10,000 stores in the US, while Trader Joe’s and Whole Foods each had fewer than 500 locations.
I'm not sure. Each individual TJ's and especially WF store is much larger than the grocery section of an individual CVS. Even the smallest TJ's I've been in (Back Bay) is larger than the largest CVS grocery section I've been in (3 aisles?). I would expect the per-store figure to be obviously in TJ's/WF's favor.
I feel like the most appropriate metric would control for total population served (to discount both the fact that WF and TJ's don't exist everywhere CVS does, and that there are more CVSes per capita than the others where two or more of the three exist).
Nah I think the more interesting metric would be total sales to populations served by both CVS and one or both of TJ and WF. There may be many more CVSes, but, owing to their small size, there are also many more CVSes serving a given population than there are WFs and TJs, such that those populations have the ability to choose one or the other.
I'm not sure WholeFoods and Trader Joes are good representations of grocery stores nationwide. Both are classified as "Specialty and natural food stores" and have drastically fewer stores than the supermarket chains.
This is part of what I was in the middle of commenting. This article seems like it's trying to force together a narrative from unrelated datapoints. TJs is one of the smallest grocery store chains and WF is just a bit bigger, meanwhile CVS is the largest drugstore chain. It is also unclear to me how "retail food marketshare" is measured. Is it just comparing overall revenue among chains that sell groceries? Sales of, specifically, grocery food items? Share of people who have shopped for groceries at these stores?
Just because someone buys a grocery item from CVS does not remotely imply that CVS is their primary grocery store.
>> A representative of the company, which launched an initiative in 2014 to become the first pharmacy to quit selling cigarettes, indicated via email that they see food as the next frontier.
Wow. What leadership. It only took a couple generations for a place that sells medicine to stop selling cigarettes. It should be only a quick thirty or forty years before they stop selling the deep fried salt cakes. Are they still selling homeopathic "remedies"?
There are lots of pharmacies in this world. I seriously doubt CVS was the first to do anything. Somewhere out there, probably in Utah, there had to be a pharmacy that didn't sell cigarettes prior to 2014.
Interesting that even if you put fresh produce in a 'food desert' that people don't buy it.
I wonder if a lot of this has to do with how family life is going. It is not the 1960's any more and we don't have the whole family sat around the table at dinner time with mum having been home all day keeping the house in order.
For people who don't have a dining room and people to cook for, why lovingly prepare a meal from fresh produce when junk food can be eaten instead? Price isn't everything. Neither is cooking skills or familiarity with what vegetables look like. Ready meals rule in an atomised society.
In the 1960s mom might have started dinner 3 hours before it hit the plate, before anyone else got home. Even recipes listed as 'quick' take at least 20-30 mins to prep, call it another 30 mins to eat, and then 15 mins to clean. In a world where wages are stagnant while housing costs rocket, and both parents need to work, free time is at an all time low.
Not a lot of people have that kind of time to prepare a healthy meal, especially when they get home exhausted from work or have to get ready to work second or third shift, and might be trapped in a car two hours a day. Who has time to shuck corn, mash potatoes, and peel rutabagas? It becomes far more attractive to pop in the take and bake lasagna and throw the tin out afterward and actually have some time to spend with your kids before you put them to bed.
Why would we combine Whole Foods and Trader Joe's? Whew, at least it's not bigger than Target and Walgreens combined though! It is however about 40% the size of Kroger... so there is that.
Yeah I'm honestly not sure why people would be surprised at this comparison - Whole Foods and Trader Joe's are specialty stores. Nobody goes into them just to buy a head of lettuce.
Trader Joe's has their own in-store brands for tons of products, which has spawned various guides on what should/shouldn't be bough there (https://www.thepennyhoarder.com/save-money/what-to-buy-at-tr... for example). CVS, on the other hand, is a far more general store. They both sell food, but they're not in the same market segment - so the comparison is strange.
It's not very surprising. When you take a broad meta-category like "groceries" and have 10x the number of locations, it isn't shocking that they would move more product.
Trader Joe's and Whole Foods target specific demographics. I live in a metro area of about 300k people and there are 1 each Trader Joe's and Whole Foods. There are probably 40-50 CVS outlets. Their sole income driver is margin on food. CVS focuses on market saturation -- their profit driver is drugs (a market in which they vertically integrate distribution) that are mostly 3rd party paid. They survive in food deserts because the money made on drugs offsets heavy shrink losses.
My guess is they might fill a supermarket niche more in denser urban areas. I don't know first hand but it cluld make sense.
I heard accounts of ironically Whole Foods which is referred to as "whole paycheck" in other areas being the cheap option in some areas. I would guess traffic vs stock would also influence prices in non-obvious ways. With perishables, more expensive real estate, high traffic, and customers more likely to buy everything by foot they may be less of a speciality niche in urban areas than suburbs.
I've noticed a similar thing happening with prepared food. If there are Wawa stores in an area, there usually aren't as many sandwich or salad places nearby as you'd expect. Where I work, your options are basically Wawa or bottom-tier fast-food chains (McDonald's, Taco Bell, etc.). I really wish there were more health-oriented quick-service options (even a Chipotle would be nice), but I don't think they can compete against a place like Wawa since it's good enough for the vast majority of people.
For people scratching their heads wondering what the heck Wawa is, I have no idea what the West Coast equivalent would be. Sheetz is another similar chain on the East Coast, if that rings any bells...
Wawa was a grocery chain long before they were a gas station, and I know they are imagining a future without the ICE. It's one of the ways they'll crush the BPs and Exxon that are first and foremost gas stations.
Has anyone attempted a mobile grocery store that drives to food deserts on a fixed schedule? It could say be a container with a single aisle, stocked with the basics and a checkout at one end.
I don't think so, because "Food deserts" are what happens when the demand for ideologically congenial explanations for socially inconvenient facts greatly exceeds the supply. There is an assumed causal directionality which turns out to not be supported.
Most places are food deserts not because market forces don't work there, but because they do: People in those areas do not want to buy fresh vegetables and raw ingredients for cooking. They prefer to buy packaged/processed foods, regardless of cost or health comparisons they are making, or not making. This makes traditional grocery stores less worth it, so they leave if they can't make do.
There's a lot of literature on food deserts (as typically stated) being more or less a meme since 2015, here's one example with a couple studies to back it:
> Another study, published this week as a working paper by the National Bureau of Economic Research, looked across the country and found that no more than a tenth of the variation in the food people bought could be explained by the availability of a nearby grocery store. The education level of the shoppers, for example, was far more predictive.
And so on. So no I don't think your idea would work particularly well past the novelty stage :(
In one neighborhood I lived in in NYC, the only local supermarket closed down to make way for a Walgreens. They tried to reassure the community that they would stock staples like (terrible) bread and milk, but obviously no fresh food like vegetables.
This neighborhood was not a poor one. Million dollar condos (forget houses), all around.
The core problem is zoning. NYC makes it either impossible or prohibitively expensive to find an acceptable site for a large-format grocery store. In Manhattan, all recently built grocery stores have had to be in basements to work around restrictive zoning: https://twitter.com/MarketUrbanism/status/105451854997111193...
However, there are only so many buildings with acceptable basement layouts, and only so many neighborhood that are profitably enough to merit the additional capital and operational cost of a supermarket in a basement.
I almost always go to CVS when I need to get a few small items in a hurry (I usually use Amazon Fresh for groceries), so I'm not surprised about this at all. Going to CSV is much easier than fighting the crowd at Walmart since there's only a handful of people there at any given time.
Ditto. My wife and I are stereotypically the perfect WF/TJs customers: ecologically-minded hippie-ish DINKs in an upper-middle-class suburb. We live a 3 minute drive from both, and she works a short walk from a Roche Bros (which serves a similar demographic).
Yet, despite the poorer selection and higher prices, the majority of groceries that enter our house come from CVS. Why? My wife visits one regularly to pick up prescriptions, and they have just enough of what we buy, at sufficiently justifiable prices, that she can get enough of what we need without an extra trip to a different store.
The most convenient store is the one you're already at.
In Massachusetts, convenience stores and gas stations seem to be the only things open at night. I wonder if grocery stores do better in places like upstate NY where the grocery stores are also open 24hr.
Have the larger American grocery stores opened small convenience stores?
This has happened in several European countries. For example, in the UK Tesco has opened many "Tesco Express" shops in towns and cities. They are fairly small, but they can take advantage of Tesco's huge distribution system to stock a wide range of products, including fresh food. Prices are the same as the large shops, but the 20% of products they stock are the dearer ones.
In Canada the corollary is 'Shoppers Drug Mart' and ever since they merged with the national grocer chain, I can get >50% of my groceries i.e. milk, bread, cheese, meat (I mean none of it is super high quality but often good enough) because it's across the street! And there is no lineup.
Does it have to be worse quality? If anything, a more uniform distribution of stores should allow development of pretty tight local supply chains, that could provide fresh(er) food.
Weird that metro supermarkets are so rare in the US. All over the EU in major cities people do most of their shopping in small, well-stocked (for their size) supermarkets.
[+] [-] AdmiralAsshat|6 years ago|reply
[+] [-] ghc|6 years ago|reply
So when I run out of flour, I have a decision to make: would I rather sit in traffic for 30 minutes, wait for instacart/amazon fresh delivery, or go to CVS/Walgreens? I suspect there are many people like me who pay the markup every day because it's less of a hassle.
[+] [-] Shivetya|6 years ago|reply
Plus in some areas you cannot get a grocery in due to zoning or regulatory agencies which can increase the costs of worker and compliance needs beyond normal. There are many rules regarding handling of produce and raw foods that drug store type sellers never have to meet.
[1] https://www.fns.usda.gov/snap/eligible-food-items
[+] [-] dsfyu404ed|6 years ago|reply
WF (or Trader Joes for that matter) simply doesn't sell value priced versions of a lot of items. CVS will sell it at a ripoff. It probably comes out close to a wash put poor people are poor, not stupid. If the numbers worked out in favor of WF they would be shopping there. Also, nobody(TM) does their entire shopping at CVS. People will drag their asses elsewhere on a regular basis to buy certain items that are cheap. Many convenience stores, bodegas, etc. will sell a couple staples or classes of items dirt cheap in order to attract business. You buy your regular items where they are cheap (e.g. $1.50/gal brand name milk from the bodega that buys about to expire milk from a restaurant supplier for pennies and passes on the savings to create foot traffic) and buy everything else at CVS.
[+] [-] sct202|6 years ago|reply
[+] [-] Broken_Hippo|6 years ago|reply
All sorts of folks buy from CVS, mostly stuff on sale but not always. Moms with a sick child and elderly folks in to get medicines are a good chunk of the customers. Folks without transportation are a few people, sure. In one store, some of the food traffic was simply because we were in a small town with limited groceries: Some of the food was nearly as cheap as the local places. We got a boost of traffic because of football games at a college about 25 minutes away.
The second store was a 24 hour store, and though the town had 24 hour grocery stores, they weren't next to us at night. We were not far from a small college as well. And again, same sorts of customers, usually picking up one or two things.
Even more extra bonus points on holidays, since we were always open (at both stores). I think people figured we'd be less busy.
[+] [-] unknown|6 years ago|reply
[deleted]
[+] [-] oddthink|6 years ago|reply
Whole Foods 365 brand organic milk is slightly cheaper than CVS, but it's a slightly longer walk and has longer lines and is in a basement, so I tend not to bother. (I probably should go there more often.)
[+] [-] dd36|6 years ago|reply
[+] [-] manojlds|6 years ago|reply
Why so?
[+] [-] basseq|6 years ago|reply
> The eyebrow-raising figure probably comes down to an issue of scale – last year CVS and Walgreens each had close to 10,000 stores in the US, while Trader Joe’s and Whole Foods each had fewer than 500 locations.
[1] https://docs.google.com/spreadsheets/d/1CzhWggSef2pbRMJam1m2...
[+] [-] colanderman|6 years ago|reply
I feel like the most appropriate metric would control for total population served (to discount both the fact that WF and TJ's don't exist everywhere CVS does, and that there are more CVSes per capita than the others where two or more of the three exist).
[+] [-] colanderman|6 years ago|reply
[+] [-] rb808|6 years ago|reply
WF and TJ are niche supermarket chains, its just another dumb headline. https://www.statista.com/statistics/818602/online-and-offlin...
But my fear is growing...
[+] [-] francisofascii|6 years ago|reply
[+] [-] stronglikedan|6 years ago|reply
More like 20x.
FTFA: last year CVS and Walgreens each had close to 10,000 stores in the US, while Trader Joe’s and Whole Foods each had fewer than 500 locations.
[+] [-] TrueDuality|6 years ago|reply
[+] [-] ilikehurdles|6 years ago|reply
Just because someone buys a grocery item from CVS does not remotely imply that CVS is their primary grocery store.
The USDA has better numbers representing the market. https://www.ers.usda.gov/topics/food-markets-prices/retailin...
[+] [-] throwayEngineer|6 years ago|reply
[+] [-] sandworm101|6 years ago|reply
Wow. What leadership. It only took a couple generations for a place that sells medicine to stop selling cigarettes. It should be only a quick thirty or forty years before they stop selling the deep fried salt cakes. Are they still selling homeopathic "remedies"?
There are lots of pharmacies in this world. I seriously doubt CVS was the first to do anything. Somewhere out there, probably in Utah, there had to be a pharmacy that didn't sell cigarettes prior to 2014.
[+] [-] elektor|6 years ago|reply
[+] [-] Theodores|6 years ago|reply
I wonder if a lot of this has to do with how family life is going. It is not the 1960's any more and we don't have the whole family sat around the table at dinner time with mum having been home all day keeping the house in order.
For people who don't have a dining room and people to cook for, why lovingly prepare a meal from fresh produce when junk food can be eaten instead? Price isn't everything. Neither is cooking skills or familiarity with what vegetables look like. Ready meals rule in an atomised society.
[+] [-] asdff|6 years ago|reply
Not a lot of people have that kind of time to prepare a healthy meal, especially when they get home exhausted from work or have to get ready to work second or third shift, and might be trapped in a car two hours a day. Who has time to shuck corn, mash potatoes, and peel rutabagas? It becomes far more attractive to pop in the take and bake lasagna and throw the tin out afterward and actually have some time to spend with your kids before you put them to bed.
[+] [-] grayed-down|6 years ago|reply
Sometimes a drug/convenience store is just a drug/convenience store.
[+] [-] brokentone|6 years ago|reply
[+] [-] TheLoneTechNerd|6 years ago|reply
Trader Joe's has their own in-store brands for tons of products, which has spawned various guides on what should/shouldn't be bough there (https://www.thepennyhoarder.com/save-money/what-to-buy-at-tr... for example). CVS, on the other hand, is a far more general store. They both sell food, but they're not in the same market segment - so the comparison is strange.
[+] [-] Spooky23|6 years ago|reply
It's not very surprising. When you take a broad meta-category like "groceries" and have 10x the number of locations, it isn't shocking that they would move more product.
Trader Joe's and Whole Foods target specific demographics. I live in a metro area of about 300k people and there are 1 each Trader Joe's and Whole Foods. There are probably 40-50 CVS outlets. Their sole income driver is margin on food. CVS focuses on market saturation -- their profit driver is drugs (a market in which they vertically integrate distribution) that are mostly 3rd party paid. They survive in food deserts because the money made on drugs offsets heavy shrink losses.
[+] [-] Nasrudith|6 years ago|reply
I heard accounts of ironically Whole Foods which is referred to as "whole paycheck" in other areas being the cheap option in some areas. I would guess traffic vs stock would also influence prices in non-obvious ways. With perishables, more expensive real estate, high traffic, and customers more likely to buy everything by foot they may be less of a speciality niche in urban areas than suburbs.
[+] [-] gbear605|6 years ago|reply
[+] [-] radcon|6 years ago|reply
For people scratching their heads wondering what the heck Wawa is, I have no idea what the West Coast equivalent would be. Sheetz is another similar chain on the East Coast, if that rings any bells...
[+] [-] masona|6 years ago|reply
[+] [-] mac01021|6 years ago|reply
[+] [-] psadri|6 years ago|reply
[+] [-] simonsarris|6 years ago|reply
Most places are food deserts not because market forces don't work there, but because they do: People in those areas do not want to buy fresh vegetables and raw ingredients for cooking. They prefer to buy packaged/processed foods, regardless of cost or health comparisons they are making, or not making. This makes traditional grocery stores less worth it, so they leave if they can't make do.
There's a lot of literature on food deserts (as typically stated) being more or less a meme since 2015, here's one example with a couple studies to back it:
https://www.nytimes.com/2015/05/09/upshot/giving-the-poor-ea...
> Another study, published this week as a working paper by the National Bureau of Economic Research, looked across the country and found that no more than a tenth of the variation in the food people bought could be explained by the availability of a nearby grocery store. The education level of the shoppers, for example, was far more predictive.
And so on. So no I don't think your idea would work particularly well past the novelty stage :(
[+] [-] ctab|6 years ago|reply
[+] [-] donretag|6 years ago|reply
This neighborhood was not a poor one. Million dollar condos (forget houses), all around.
[+] [-] alexhutcheson|6 years ago|reply
However, there are only so many buildings with acceptable basement layouts, and only so many neighborhood that are profitably enough to merit the additional capital and operational cost of a supermarket in a basement.
[+] [-] ezekg|6 years ago|reply
[+] [-] colanderman|6 years ago|reply
Yet, despite the poorer selection and higher prices, the majority of groceries that enter our house come from CVS. Why? My wife visits one regularly to pick up prescriptions, and they have just enough of what we buy, at sufficiently justifiable prices, that she can get enough of what we need without an extra trip to a different store.
The most convenient store is the one you're already at.
[+] [-] nix0n|6 years ago|reply
[+] [-] Symbiote|6 years ago|reply
This has happened in several European countries. For example, in the UK Tesco has opened many "Tesco Express" shops in towns and cities. They are fairly small, but they can take advantage of Tesco's huge distribution system to stock a wide range of products, including fresh food. Prices are the same as the large shops, but the 20% of products they stock are the dearer ones.
[+] [-] rjsw|6 years ago|reply
[+] [-] sonnyblarney|6 years ago|reply
In Canada the corollary is 'Shoppers Drug Mart' and ever since they merged with the national grocer chain, I can get >50% of my groceries i.e. milk, bread, cheese, meat (I mean none of it is super high quality but often good enough) because it's across the street! And there is no lineup.
[+] [-] purplezooey|6 years ago|reply
[+] [-] jhallenworld|6 years ago|reply
[+] [-] throwayEngineer|6 years ago|reply
[+] [-] ricardobeat|6 years ago|reply
[+] [-] te_chris|6 years ago|reply