Once upon a time, a young woman moved with her boyfriend to the Upper West Side of Manhattan. They lived in a 200 square foot apartment with no stove or oven (however, the landlord kindly provided a two burner hot plate and microwave, and they added a toaster oven) and a 1/4 refrigerator that sat under a counter top. Since they had both just moved from miniscule dorm rooms, they were able to deal with the cramped quarters. What they found perplexing, though, was grocery shopping. A small Gristede's chain store occupied the corner of their building, but staples were quite pricey and the produce was sad. Just sad. Up the avenues, there was a Food Emporium that suffered the same overpriced problem and was even more disgusting, and a Pioneer that was essentially a cesspool. Fortunately, they found out about Fairway Market.

This magical grocery store had super fresh produce, a cheese department, and a deli counter with prepared items of tastiness. Somehow, they were able to purchase their foodstuffs for less money than the young woman's family back in Chicago. It was a long walk, but worth it.

The young couple lived in the tiny apartment for three years. When they got married, they decided to move on up - both in the neighborhood and in apartment size. Relocating to a 420 square foot apartment with a 3/4 refrigerator, they marveled at the ability to shop for more than three items of perishable food at once. Because they moved up in the neighborhood, they were now only 4.5 blocks from Fairway, allowing them to carry larger quantities of groceries with slightly more ease. All was good.

All was so good, in fact, that they again moved apartments both in size and location. Their 850 square foot palace had a full refrigerator! They were a mere 3 blocks from Fairway! Who could ask for anything more? They enjoyed their good food at fair prices for years.

This all came to a very tragic end when Fairway decided that they should partner with a private equity firm. They built new grocery stores all over the metro New York area. To pay for these new stores, they raised their prices. A lot. Several times.

Then Whole Foods opened two stores, each one mile from Fairway. The no-longer-so-young woman hoped this might mean Fairway would drop prices to compete. Instead, they raised prices so that her yogurt (Stonyfield Farm, 6 oz) was ten to twenty cents more than at Whole Foods. It seems that this is how private equity works.

Then Trader Joe's opened a store four blocks away. Now the woman worried that Fairway might close, because even thought she resented the fuck out of their prices, sometimes it was one of the few places she could find certain items. She figured that they would lower their prices a bit to stay competitive.

Oh, how naive our heroine is! Rather than lower prices, the private equity vultures raised prices again because they had built even more stores and needed someone to pay for them. The fact that a package of cold cuts (Applegate Farm) now cost $1 more at Fairway than at Trader Joe's did not seem odd to them at all. The fact that our heroine now bought her yogurt at a specialty market up the block for a full thirty cents less per carton also did not phase them at all. The fact that their cheese department, once a highly respected place for cheese, now performed dismally, was of no consequence.

In the world of private equity, the people should just be grateful that they are allowed to shop anywhere. The people should also thank private equity for keeping markets liquid so that they can buy up neighborhood shops, jack up the prices, and lower quality.

And that is the story of how private equity fucked up my grocery store.

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