Mamdani's city grocery stores: what and how they will sell

New York City Mayor Zohran Mamdani plans to open five grocery stores in the city. These stores will offer basic groceries at 30% off retail prices. The first store is scheduled to open late next year in the Bronx. Gothamist finds out how this initiative will work and what problems it may face.

Many details of the project, from the product range on the shelves to the number of employees, will depend on who takes over the management of the stores.

Who will manage the stores?

One or more operators will be responsible for the day-to-day management of the stores.

Their responsibilities will include purchasing products, determining the product range, selecting wholesale suppliers, hiring employees and maintaining the premises.

Food market experts believe it makes sense for the city to outsource the most complex aspects of grocery store operations to a private operator, especially if the city wants to open stores as quickly as possible.

The deadline for submission of proposals from grocery chains and other eligible organizations is October 16.

Which products will be sold at a discount?

The core product set will be sold at 30% off their regular retail price. Prices will be set monthly and will remain unchanged.

The list will include:

• all fresh vegetables and fruits, including whole, chopped and ready-to-eat, as well as some frozen foods;
• meat and seafood;
• meat delicacies;
• yogurt;
• cheese;
• milk;
• eggs;
• butter;
• tofu;
• pasta;
• sandwich bread;
• flakes;
• tuna;
• pasta sauce;
• soup;
• non-hydrogenated vegetable oil;
• nuts;
• rice;
• flour;
• beans.

Highly processed foods, as well as those with excess sugar and fat content, will not receive a discount.

What do they plan to offer without a discount?

It is still unclear what other products will appear in stores,Moreover, they are obliged to take into account the various dietary needs of customers.

The assortment must include products that meet kosher, halal and gluten-free dietary requirements, as well as products for people with diabetes.

On the subject: New York City school reading test scores have plummeted, raising questions about their accuracy.

There will be no alcohol, nicotine or tobacco products for sale.

What prices will be used to calculate the 30% discount?

City officials are still determining how to calculate the standard retail price, from which a third will then be subtracted.

In general, grocery prices vary depending on the store, brand, package size, and region. They can change daily due to discounts or expiration dates.

Officials say the operator the city chooses to manage the stores will help determine base prices.

Will the project harm local shops and bodegas?

Local grocery stores and bodega owners criticized Mamdani's plan. Some even filed lawsuits, claiming that the city stores would harm their businesses.

However, food market experts believe that the opening of just five stores will not have a significant impact on the market. They believe that the impact will be felt most by stores located directly next to city supermarkets.

Urban officials They say bodega owners have nothing to worry about. City stores will no longer sell cigarettes, beer, and hot food—items that typically generate a significant portion of bodegas' revenue.

What jobs will be created?

The city said store operators must prioritize full-time employees.

Workers are required to be provided with affordable health insurance, "family-friendly wages," and other benefits.

The operator will determine the number of employees and will work with the New York City Economic Development Corporation to finalize salaries and benefits.

How much will the project cost the city?

The city initially plans to spend $70 million on the construction of these stores.

In addition, it will pay rent and taxes for each site, and will likely subsidize operating costs to keep prices on core products 30% below retail.

The amount of subsidies will depend on the selected operator, as well as its relationships with wholesalers and suppliers.

Has anyone already tried to implement a similar model?

New York City already has six markets that receive city subsidies, including Essex Street on the Lower East Side and Moore Street in East Williamsburg.

However, the new urban grocery stores will operate on a much larger scale. Similar public-private partnerships in other states have failed due to insufficient funding.

"The key here is that the city will provide subsidies and lower prices using its own funds," said Errol Schweitzer, former vice president of grocery at Whole Foods. He now runs The Checkout Grocery Update newsletter and is advising the city on the project.

New York City stores will be open to all residents.

Where will these stores appear?

The first store, measuring approximately 15,000 square feet, will open in the Bronx in the La Peninsula development at 1215 Spofford Avenue.

The second, approximately 11,115 square meters, will open in 2029 in Manhattan, at La Marqueta Market, 11658 Park Avenue.

The city continues to look for other sites in Queens, Brooklyn and Staten Island.

Who will be able to buy groceries?

Anyone can buy groceries. Stores will accept SNAP and WIC payments.

You will not be required to show identification upon entry.

Can this model be expanded?

Food market experts believe the model could be replicated in other New York City neighborhoods or even outside the city.

Additionally, a delivery and supply system could be created that would be accessible to small grocery stores and bodegas. This would allow them to obtain goods at lower prices and pass these savings on to customers.

In the grocery business, large chains often receive more favorable terms from wholesalers. Therefore, they can set lower prices than small mom-and-pop stores.

James Oumke, director of economic development at Rutgers University's School of Environmental and Biological Sciences, noted that after investing in the project, the Mamdani administration's main challenge will be proving the investment's effectiveness.

"This is the experiment voters wanted. It will be carried out in five stores, which is reasonable for an experiment," he said.