How do produce stands in NYC, Montreal, and other major cities sell their items for less than most big box chains?

Question

In NYC, there are plenty of produce vendors on the street that sell aesthetic, fresh fruit for less than cost conscious mega-chains, like Wal Mart, Trader Joes, and Wegmans. The big chains have negotiating power, wholesale discounts, and economies of scale to help them profit on tiny margins. So, how is it that my small, local, fruit stand can outcompete pricewise with national chains and still stay afloat?

In: 2607

Answer 1

I believe the answer is two-fold:

**Selling**: Without incurring the same level of overhead costs as the big warehouse stores, the guy at the little stand doesn’t need to mark up the prices as much to turn a profit.

**Buying**: While buying in bulk often counters this in favor of the warehouse stores, it may not apply to perishables (like produce) to the same degree given that the shelf life is far less. This also means the warehouse stores will see more wastage.