Many of us will celebrate this Thanksgiving with loved ones and a surplus of food. For many people, it is also a time to help those less fortunate by donating resources and time—or better yet, cash. Last week, I sat down with Bill Clark, Executive Director of Philabundance, the largest food bank and hunger relief organization in the Philadelphia region, to talk about an innovative new initiative they have developed to bring food access to those in need.
Kat: You will be opening Fare & Square, your first nonprofit food center in Chester, PA, in the spring of 2013. What exactly is a nonprofit grocery store?
Bill: A nonprofit grocery store will operate just like your typical market—offering a wide range of products, with a strong emphasis on customer service. But it will provide food stamp (SNAP) and other benefit outreach programs, and it will aim to keep prices as low as possible for consumers in need. Chester was the right location for us because that city hasn’t had a full-scale grocery store in 11 years, and it is located in what the USDA designates as a food desert. Our research found that 54% of Chester residents felt they live too far from a grocery store that provides nutritious food.
Kat: This will be the first nonprofit grocery store of such scale in the country. What led to this innovation and how exactly will it work?
Bill: Most of the food we provide comes from industry and manufacturers who have become increasingly efficient. Previously, their inefficiencies meant they had wholesome, edible food that couldn’t be sold (think a package of soup where the label was upside down), so they donated it to food banks and millions of hungry families benefited. As they’ve improved their manufacturing efficiencies, less food is being donated to us—just when, with these economically distressed times, more people need it. This nonprofit grocery store model allows us to buy food from the industry at a reduced market cost but still at a profit to the industry. Then we can sell it at a fraction above our purchasing price—but still lower than your standard commercial supermarket—and use the margin to cover our overhead costs. We’re happy because we can provide a wider variety of goods in a more reliable manner, and consumers benefit because they can purchase products below prevailing market prices.
Kat: What is the potential for this new model?
Bill: Historically, hunger has been closely tied to poverty such that it existed in geographic pockets (primarily very urban and rural areas). With the economic downturn, hunger has shifted to include more of the working and middle classes, who now have less disposable income and don’t have access to many of the emergency food providers within their communities. If it works in Chester, this model potentially could then be rolled out to more communities in need, providing them with access to affordable and healthy foods in a traditional grocery store environment.
Kat: And what does it mean for donors?
Bill: We’re excited about the potential for this model because it could ultimately be self-sustaining so that donor dollars can go that much farther. Instead of funding all of the operational expenses, donor dollars could be used strategically for things like upfront investment to launch a new site, facilities-related capital, and value-added programs (e.g., nutritional instruction). Unfortunately, hunger is a big problem that needs a movement to solve. And while some solutions are more economic than others, at this time of year we are happy to have more people focused on making the existence of hunger intolerable.
To learn more about Fare & Square and Philabundance’s work to reduce hunger, visit the program page on the Philabundance website for a fact sheet, the Purple Carrot newsletter, and more helpful information. Also, stay tuned for a related podcast by our colleagues at Knowledge@Wharton.