Oakland Food Retail Impact Study

Hannah Laurison and Nella Young | 02.01.2009

February 2009, Development Report No. 20

Picture a neighborhood in a city with a mix of houses and apartments—some big and some small, some with yards and gardens. Kids go to school nearby. Adults go to work, within the city or farther away. Some people have cars; others rely on the bus to get to work and run errands. 

There are few stores within walking distance. Some are liquor stores, a few of which sell items such as ice cream bars, chips, and sodas. To feed their families, residents shop at these neighborhood stores. If they have a car, they travel to a larger grocery store with more choices and fresher produce, where it is easier to make healthy meals and spend less than they would for convenience store items. Those who do not have a car might take the bus to purchase groceries, but they can only buy what they are able to carry back on the bus. 

Imagine that one day, in an abandoned lot on the corner of two major streets in this area, a sign announces the construction of a new “neighborhood” store on the site. It will be smaller than a typical grocery store, but it will carry staple items such as pastas, rice, cereals, and sauces. It will also carry fresh dairy products, fruits and vegetables, and prepared foods that are healthy and easy to take home and heat up. The store also promises to offer these foods at affordable prices similar to what big chain grocery stores would charge. 

This story is a real possibility for some neighborhoods in Oakland. After several decades of neglect, low-income, urban neighborhoods are seeing renewed interest from major players in the supermarket industry. Fresh & Easy, a chain store owned by the British-based Tesco, has already secured at least 20 locations throughout the East Bay. Tesco, currently the world’s third-largest food retailer, is spending $503 million each year to break into the U.S. food retail sector. At the same time, a new generation of Oakland social entrepreneurs are taking steps to develop neighborhood grocery stores that increase access to fresh, local, healthy foods while contributing to economic development, job creation and training opportunities. People’s Grocery, the for-profit arm of an Oakland nonprofit organization, aims to open a grocery store to provide fresh produce, grown sustainably by local farmers, while educating neighborhood residents about nutrition and entrepreneurship.

How will Oakland’s long-underserved neighborhoods be affected by the arrival of those two very different food retail formats?

How will Oakland’s long-underserved neighborhoods be affected by the arrival of those two very different food retail formats? Several studies have documented that the lack of grocery stores in Oakland’s neighborhoods has a detrimental impact on the health of community residents. The lack of grocery stores also means fewer jobs for local residents and fewer dollars injected into the local economy. However, no study to date has evaluated how retail format shapes grocery stores’ influence on the social, economic, environmental sustainability of neighborhood food systems. Retail format may be defined by store size, ownership structure, the range of products and services, pricing structure, operating style, and store design.

Small, locally-owned neighborhood stores are an appealing solution for many who seek to build wealth in underserved communities while improving access to healthy food. Others believe that low-income communities would benefit most by having the opportunity to shop at the same mainstream grocery retailers found in affluent and suburban communities. In this report, Public Health Law & Policy (PHLP) investigates the deep, long-term impacts these different food retail formats have on the well-being of Oakland’s residents, the local economy, and the food system. In order to do so, we describe the current status of Oakland’s initiatives to support food retail and sustainable economic development, and we assess the potential influence of Fresh & Easy and People’s Grocery on Oakland’s community, economy, and environment. Through this analysis, this report seeks to answer the following questions:

  1. What food retail format offers the greatest selection of healthy, affordable, fresh, and culturally appropriate food?
  2. What food retail format makes the greatest contribution to local wealth?
  3. What business practices contribute to community well-being?
  4. Which labor practices create good jobs for neighborhood residents and throughout the supply chain?
  5. How can grocers contribute to a healthy, clean environment?

 

Although we use an Oakland-specific case study, with this comparative analysis in mind, we offer a framework for analyzing the sustainability of food retailers in general. This framework can be applied to other businesses to establish priorities for negotiation, decision making, and policy. It is our hope that this report will promote both pragmatic and philosophical dialogue about food retailers’ role in a sustainable local food system for Oakland. We aim to equip food policy advocates a broad framework for characterizing the impact of food retail format on the whole community and to build the case for supporting food retail that actively contributes to equitable, sustainable neighborhood development.

This study was commissioned by Food First, whose mission is “to eliminate the injustices that cause hunger.” As the convener of the Oakland Food Policy Council, Food First works to define priorities, policies, and incentives that support the development of sustainable food retail in Oakland. Food First and the Food Policy Council members will also use this framework to engage community residents and advocates who want to ensure that food retail development plays a role in the sustainability and well-being of the local community.