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
There is normally a food terminal in city where produce arrives. Everyone can go and bid on the produce. The buyers for the big supermarkets will probably be buying 100 crates. But then they have to put them in that trucks and take them to that distribution center and repackage them and send them to the store and that cost a lot of money.
The little stands bid on 1 or 2 crates, then throw them in the back of the van and drive to the side of the roads with very little overhead. They’re not paying for a refrigerator distribution center or rent and maintenance on a massive supermarket.
The lack of cost that they have between bidding at the food terminal and selling at the side of the road is why it’s cheaper for them.
Edit: fixing a couple of words from drunken voice typing
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