New data from the USDA shows that there are fewer places to buy groceries every year, but consolidation is especially high in rural areas.
USDA report shows that the percentage of food sales from the nation’s top 20 retailers more than doubled from 1990 to 2020. Consolidation was more visible in rural areas.
“The food retail markets in rural and small non-metro counties are significantly more concentrated than the food retail markets in urban and large non-metro counties,” the report said.
This means that for many small town residents, food shopping requires a trip to Walmart across multiple cities or trying to make do with the prepackaged and canned foods available at Dollar General.
While smaller, full-service grocery stores are becoming less common, some grocers in small towns are finding ways to stay competitive while in other communities they are teaming up to open their own.
Sanborn Foods in Sanborn, Iowa is still in operation despite only 1,400 people living in the city. Owner Scott Vogelaar has found a way to compete with larger grocery stores in nearby cities. He joined the Associated Wholesale Grocers, a cooperative of small shops based in Kansas City, Kansas.
“As big as they are, and as many stores as there are stores owned by the co-op, they have really good purchasing power from the manufacturers and that helps us a lot with prices,” he said.
Vogelaar said he is also working to make his store stand out with quality and service in certain departments.
“Meat and produce is where we can do it,” he said.
But Vogelaar acknowledges that “most buyers are driven by price.” Within the framework of the cooperative, he can receive better prices and pass savings on to clients.
When the supermarket closed in Mount Pulaski, Illinois, a community grocery store took its place. In 2020, Market On The Hill opened in a city of 1,500 people. The store specializes in locally grown produce to help differentiate itself from national chains miles away, as well as the dollar store that has opened in town.
“Every day we have a deli and fresh pastries. This is something that Dollar General cannot offer,” said Caitlin Weitekamp, board member of Market On The Hill.
Opening a grocery store just after the start of the coronavirus pandemic and then facing high inflation last year makes it hard to know what normal operations will be like, Weitekamp said. However, she said local grocers are confident they will succeed even if consolidation in the grocery industry continues.
“We are here because the people of Mount Pulaski want us to be here and that is really what will matter in the future,” she said.
This story was produced in collaboration with Harvest Public Media, an amalgamation of public media newsrooms in the Midwest. It reports on food systems, agriculture and rural issues. Follow Harvest on Twitter: @HarvestPM
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