Economy
10:42 am
Mon April 9, 2012

Big box store could threaten last black-owned grocery store in Detroit

A big box retailer could move in and compete with the last black-owned grocery store in Detroit, according to a piece by Louis Aguilar in today's Detroit News:

The owner of Metro Foodland in northwest Detroit says he may soon face the biggest threat in his 27 years as a grocery owner. A Meijer store with a grocery, garden center and gas station is planned a mile and a half away.

"I have concerns that it could kill our business," Hooks said.

There are 83 full-line grocers in Detroit, and Metro Foodland is the last black-owned grocery in the city, said Auday Peter Arabo, president of the Associate Food and Petroleum Dealers, which represents 4,000 retailers in Michigan and Ohio.

Turning a profit is tricky for independent grocers. Aquilar reports "independent grocers have an average net profit margin of 1.08 percent before taxes, according to a 2011 survey by the National Grocers Association and FMS Solutions." Competition from a chain like Meijer could crimp those profits further. It could be a couple of years before the new Meijer store in northwest Detroit becomes a reality. The News reports that Detroit Public Schools owns property where the store would be built, but the district said late last year it plans to sell. 

"We are definitely interested in that site, no doubt about it, but at this point it's a developer-driven project," said Meijer spokesman Frank Guglielmi when asked about a store timeline.