How do food deserts happen?

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Is it just a matter of zoning laws? Because in strictly economic terms, it seems to me like it would be very advantageous to open a grocery store in a neighborhood that is devoid of them.

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It’s a combination of zoning laws and the way competition works.

Zoning laws initially restrict where grocery stores can open. After grocery stores do open, market forces can drive them away.

For example, a neighbourhood grocery store at the edge of a community might open at first, but it can get dwarfed by a larger grocery store a couple of blocks away on the main drag. However, that store could later be closed for various reasons, such as the company moving to an area with more space a bit further away.

The original reason for the neighbourhood grocery store closing is gone, but it’s hard for a new one to open up again. This can be for a number of reasons, such as bus routes no longer serving that area, or a new restriction on truck sizes that got put in place since the grocery store left.

We tend to crowd the poorest people into close proximity. Supermarkets are generally a low-margin business. So if you’re opening a supermarket, there isn’t a ton of money to be made opening a location where no one has much money for luxuries and are just buying not-terribly-profitable staple foods.

At least in the US, it tends to be about socioeconomic divisions. In just about any city*, there are going to be richer neighborhoods and poorer neighborhoods, and in a lot of places those lines between neighborhoods are going to be along racial lines as well. Just because segregation is no longer policy, doesn’t mean it isn’t still felt, and reflected in urban demographics.

So yes, you would think that opening up a grocery store in a food desert would be a profitable choice- but consider where food deserts tend to be. They tend to be in poor neighborhoods, which might have higher crime rates, and are typically full of people of color. So, when some grocery store CEO is deciding where to expand and looking at the numbers- they’re more likely to open a new store near wealthier people, in a safer area. Even if those well off people already have another option to get fresh foods.

And then of course, people in food deserts end up with health problems due to not having easy access to unprocessed foods, and the cycle of poverty continues.

*rural areas can be food deserts as well- for the similar reason that the people are often poor, and also that population density is low, which likewisemakes a grocery store less economically viable.

It’s a combination of factors. Food deserts are generally older urban neighborhoods that have transitioned from middle class to poor neighborhoods. Traditionally, people in the neighborhood shopped in small local grocery stores, but those have largely been driven out of business by big box supermarkets and replaced by more general convenience stores. The bigger supermarkets are generally further out in the city where it’s easier and cheaper to purchase the land necessary for a big store plus large parking lot. Some people in the food desert simply drive to the supermarkets, but the nature of a poor neighborhood is that not everyone has reliable car access. Economics of scale make it tough for smaller groceries in the food desert to stock things like fresh produce, especially when they’re losing many of their more middle class shoppers to the cheaper supermarkets.

Americans like living in houses. In Europe, apartments are more common and we have sidewalks. As a result we have a supermarket at most every 10m walking distance. This can’t happen in a house neighborhood

A small town near me is a good desert. They had one grocery store, but there wasn’t enough business to get it open. Now the town opened a store to try and solve the issue.

Not really an ELI5 answer, but h[ere’s an interesting recent podcast about Food Deserts if you are curious and want to learn more!](https://freakonomics.com/podcast/is-poor-nutrition-a-supply-problem-or-a-demand-problem/) It’s from No Stupid Questions, which is Stephen Dubner (Freakonomics) and Angela Duckworth (Author of Grit).

Large corporations won’t invest into poor neighborhoods due to inability to make profits, so older areas where its expensive to redevelop property to modern store formats that are often poor end up not getting new stores and old stores close for various reasons resulting in large areas without the kind of grocery or dining options found in new developments or wealthier areas that can afford to redevelop. Sometimes government help fund redevelopment like brownfield $ to spur investment, but a corporation is still not going to invest if they can’t forecast at least breaking even. You still have to build to code in poor areas, find employees, insufficient parking for customers, etc..

Well, note that when we talk about “food deserts”, we don’t mean a literal absence of food. There’s undoubtedly a local convenience store that has a stock of candy bars and snack chips, maybe even frozen TV dinners. We’re talking about a lack of access to *fresh* food.

The main problem is lack of demand. Produce is perishable, so a store can’t stock up on it and then gradually gin up enthusiasm; it’ll end up throwing out most of the produce before people learn to like it. (If somebody has never seen fresh produce before in their life, and was never taught any recipes that call for it, they’re not likely to find it very appealing. Broccoli tastes bad the first time you taste it, potatoes are ugly-looking, pineapples are hard to open if you’ve never had reason to buy a cutting board and cleaver and so your only tool is a pair of scissors, etc.)

There’s also an economy-of-scale issue. A large store that caters to drivers from two miles around can rely on the Law of Large Numbers to estimate about how much produce it will sell in a given week. But a corner store that caters to carless people from two blocks around can’t. (Imagine that you’re a small neighborhood grocer and I’m the only person in the neighborhood who likes corn on the cob. However, I don’t buy it *regularly*; instead, at random times about once per summer, I want twenty cobs for a barbecue party. Are you going to order twenty cobs of corn from your supplier every few days, in hopes that that’ll be the day of my party, or are you going to tell me “sorry, we don’t carry fresh corn”?)

I live in a rural peninsula. A few years ago Walmart came in and built a big store down near the end of the peninsula. They started off with prices lower than all the mom and pop stores around until they all went out of business, they raised the prices 15% higher than they ever were at the local stores. Now they’re the only place to get food and you have to drive to the other end of the peninsula to even do that. They’re the only major thing within an hour of my house, and they know it. They have entire algorithms and server farms dedicated to studying and crushing local economies because it’s not a monopoly if it’s on a local scale. Antitrust has failed us utterly.

One of two ways.

1) A big box store like Walmart opens a store in a small town. They crowd out the small-town stores (most notably, grocery stores) that specialize in selling things you can buy for cheaper at Walmart. No one has money anymore because all those stores the townsfolk used to own shut down. Walmart sees their profits drop because no one has money. They then close that location, leaving the town with no options at all unless the people drive several miles out of their way.

2) A grocery store is in a place where poor people live. It used to not be that way, though it is now. Those people can’t afford much of anything beyond their basic needs and often need help from the government just to meet those basic needs. The store doesn’t have to stay where it’s not making money, so they close that location down. All those poor people now have no place they can access to buy food.

Even if pure economics suggest it’s beneficial to open where there are not competitors, there are other considerations like crime/theft risks, ability to attract and maintain workers in that location, whether product mix would be efficient to sell.

A major chain that has access to the capital to open might decide it’s too risky and profit potential isn’t worth it — the store would be more likely to get robbed/deal with shoplifting; they might have trouble getting qualified workers willing to commute to a bad neighborhood, and those who live there may not be dependable; it’d take extra time/effort to customize product mix for a different income/ethnic demographic, etc.

Conversely, somebody who knows the area well and might be able to better build a store that would cater to the needs of the area might have issues getting loans/capital to open such a store. Banks might view the area as too risky compared to opening elsewhere, and not want to lend. And suppliers might not be willing to extend lines of credit, etc. necessary to keep such a business afloat.

Grocery stores make very little money, and only do so if they have advantageous deals with suppliers, high markups, or economies of scale. The 1st thing is not something that every company can do, they all try but most fail. High markups only work for certain types of grocery stores like high end or ethnic stores where their clientele can afford the high markups – food deserts are typically in lower income areas where this isn’t possible. Economies of scale obviously require large volumes, which only happens if there is a large amount of demand, which isn’t really the case in many food deserts due to issues with transportation or not having the time or knowledge to cook from scratch.

There have been efforts to open grocery stores in food deserts before but they typically go out of business due to these factors.