The case for local, mom & pop grocers over Walmart

Vasundhara Jolly January 14, 2017 1:29 AM (UTC+8)
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The first time I traveled to the United States was in the year 2004.

A usually curious and eager thirteen-year old, I was a little surprised when my grand-aunt who lived in Rochester, New York, suggested we take a late night visit to the supermarket as she wanted to buy some vegetables.

That visit was a revelation for various reasons. Firstly, she expected fresh vegetables in the middle of the night. My mother in New Delhi awoke at 5.30am two to three times a week to score the freshest vegetables and fruits at our local grocer’s. Secondly, she assumed a supermarket visit would be comparable to a visit to a historical sight. To describe the local grocer where my mother shopped (and my grandmother before her), as a hut would be a stretch. Even though this might sound like a cliché, I promise you it cannot be repeated enough: for someone who has never seen one before, the American supermarket is nothing short of a marvel. And for a thirteen-year old, to look at rows and rows of perfectly ripe and shiny fruit in which one can see their reflection, can be a metaphor for what possibilities the future can hold.

The industrialization of our food, and the increasing disconnect with where it comes from, has led us to normalize the concept of these Franken-supermarkets. Thomas Reardon, a professor at Michigan State University, succinctly argues that the influx of foreign direct investment, and the technological advancements in retail procurement technology and inventory management are phenomena that must be embraced by the emerging markets of Latin America, Africa, and Asia. Global retail multinationals such as the Carrefours and the Walmarts, with their access to liquid funds, international credit and their use of the aforementioned systems, are driving the produce retail markets, and hence, should be the cornerstone of development policies in lower income countries.

Walmart’s first foray into the Indian market, which is saturated with local players, was a disaster. While its official entry required a joint partnership with Bharti Enterprises, a giant business house with its feet in everything from telecom to education, it was also met with widespread protests from concerned citizens. The entry of a deep-pocketed retail giant would wreak havoc on the largely informal and local agriculture supply systems which had developed their own systems over time. Despite an admission of guilt to a $25 million lobbying charge, their 20 odd stores (a small number for a potential market of a billion people) which were set up in tier-2 cities under the pseudonym of “Easy Day”, continued to function but failed to gain the patronage of the consumers. Conversely, Walmart in the US is one of the largest suppliers of organic produce now, hoping to catch on to growing trends in consumption.

The supply-chain of this industry in India is largely informal. A nexus of smallholder farmers and middlemen, which make up an estimated 50 million small traders are involved in the farm-to-store agriculture business across India. This informal network ensures the produce reaches mom and pop grocers (or kirana stores). The kind of farmers Walmart is looking for are large-scale commercial farmers, which make up a small section of India’s agrarian economy.

If agriculture and food were solely dependent on economic efficiencies, the story might be different. It is political: under a Congress-led government, Walmart’s market experiment shriveled. In BJP’s Modi government, big business has an ardent supporter. His policies, which have focused greatly on bringing in FDI, retail giants like Walmart can likely see a renewed boost.  Agriculture is also culture: Punjab, one of the highest agricultural productivity states in India, celebrates the harvest festival of Lohri with much gusto, signifying the end of the winter solstice and the beginning of the rabi cropping season.

Conscious (albeit price-insensitive) consumers in the liberal oases of the Eastern coast of the United States now prefer to shop organic produce at local stores, choosing to vote with their dollar for smaller stores that share their values (such as Trader Joe’s or Whole Foods), or farmer’s markets for urban spaces that can afford them. But cities of the developing world have always relied greatly on their trusted and local networks of local mom and pop stores to supply their daily food requirements. For long-time customers, these stores even provide short-term credit. It seems counter-intuitive then, to push for multinational retailers to put small suppliers out of business in developing countries, if the arc of the food supply system is ultimately bent towards the smaller, values, and relationships focused retail process.

The day my grandfather passed away in New Delhi, I was immediately dispatched by my mother to Mr. Garg’s kirana store, to buy supplies we would need for the memorial services, and to feed the stream of visiting relatives and friends. Upon receiving a distraught third-generation customer, Mr. Garg immediately collected all the things he knew our house to usually order. Once he heard the news, he refused to take any money from me. He didn’t have any shiny fruit I could see my reflection in, but he was connected to my family in the way food is always meant to be. The nature of how humans engage with food stands at odds with the values of industrial, and mass retail systems; food is personal, cultural, and the basis of our human connection.

Vasundhara Jolly
Vasundhara Jolly is a final year M.A. student at The Fletcher School of Law and Diplomacy, focusing on Development Economics, and International Environment & Resource Policy. She has several years of development experience: through the Clinton Fellowship at the American India Foundation in New Delhi, at Human Rights Watch in New York, and as a consultant for grassroots non-profits in India. She holds a B.A in International Relations from Tufts University, Medford.
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