How do Whole Foods’ $6 cupcakes help Detroit’s urban poor?
When I was in Detroit this summer, I found myself in a neighborhood that was like a narrow wedge cut out of Williamsburg, Brooklyn, and lowered gently onto Michigan Avenue. I was stunned to find this place, although I don’t know why — the forces that made Williamsburg (and whatever preceded Williamsburg) are on the move, so why wouldn’t they be here too?
As I was wondering at all this, standing in a bookshop that was really just a few dozen very obscure books arranged artfully in a white-walled space, I heard a crunching sound. I looked over, and there was a group of young, art-student types, sitting on the floor, passing a box of salad back and forth.
“Where,” I said, “did you get that salad?” Detroit is a place of many wonders, but, historically, salad has not been one of them.
“Whole Foods,” she said. “It’s just a few blocks away.”
“We eat there all the time!” her friend chimed in.
Over at Slate, Tracie McMillan, a welfare and poverty reporter turned food writer, has just written an epic story about that very Whole Foods. Because McMillan’s project was funded by the Food and Environment Reporting Network (FERN), a nonprofit that supports investigative food journalism, the reporting is much more in-depth than usual — the article is well worth a read.
As it turns out, Detroit’s Whole Foods is a big deal — the first of several shops that the company has been opening in mixed- to low-income neighborhoods around the country, as part of an overall strategy to nearly triple the number of Whole Foods locations nationwide. Walter Robb, the co-CEO of Whole Foods, was inspired to open the Detroit location after a lunch with Secretary of Agriculture Tom Vilsack — the two talked about access to healthy food as a public health issue, and Vilsack offered to put Robb in touch with a group of city officials in Detroit who might help with opening a store there.
The officials did, and how.
[The city coordinated] $5.8 million in public subsidies and private grants for the developer Whole Foods had selected to build the store. That was enough to bring the store’s rent down to $6 a square foot, according to internal documents obtained by reporters at a local community paper, the Chaldean News (and shared with Slate). The rent, which was less than one-third of market rates last summer, served as a kind of insurance for Whole Foods, whose initial sales projections suggested that Detroit was a losing proposition. With rent that low, the store would make money even if the models were right, and sales were dismal.
Robb spoke about the process of opening a Whole Foods in Detroit in bold tones — “We’re going after elitism. We’re going after racism.” Real success, Robb told McMillan, would be using the store as a platform to improve the health of Detroit residents. To that end, the Detroit Whole Foods offered classes on how to shop in its stores on a budget and hired a store nutritionist, Akua Woolbright, to teach classes “in high schools and community centers, urging people to eat diets based on whole ingredients, dense nutrients, healthy fats, and plant-based food.”
What it did not do, though, was sell food that low-income people could actually afford. When McMillan compared prices between Whole Foods and other local grocery stores, she found that Whole Foods was charging more for basic grocery staples — about 29 percent more, on average. McMillan asked Whole Foods how many of the Detroit store’s sales came from SNAP — food stamps.
[N]earby independent grocers had told me 75, even 80, percent of their sales came from SNAP. Though Whole Foods declined to share specific numbers, Robb did say that SNAP sales in Detroit were an impressive five or six times the chain’s average, suggesting they had reached more of the poor than at their other stores. A source who was familiar with the Detroit store and its initial sales performance, and who declined to be named for professional reasons, told me that Whole Food averages about 1 or 2 percent of sales from SNAP nationwide. If both Robb and my source are correct, 5 to 12 percent of Whole Foods’ Detroit sales are from SNAP. Since 38 percent of Detroit residents make use of the SNAP program, this estimate suggests the store isn’t reaching a cross section of the city, but a targeted, upper-income niche.
Indeed, last summer, when all the numbers had been crunched after the opening crush of business, the store found itself considering selling more expensive items, not cheaper ones. The top seller in the bakery department had been a single cupcake, baked in a half-pint jar. It sold for $6. … By autumn, bottles of wine topped out at $42, and meats at $30 per pound, instead of $20. This slide toward higher prices suggests that Whole Foods was having more success with its traditional customers than with lower-income ones.
Putting a Whole Foods into Midtown adds some jobs within the city’s boundaries, which is great. The city subsidies are certainly better than the boondoggle stadium and casino projects whose siren calls have lured so much city funding. But it’s not like Whole Foods is a social services agency, even when it talks like one. It’s a business — one that is going gangbusters, actually. The store chose a killer location: a 15-minute walk from three different college campuses, a block away from a medical center, five minutes from the entrance to every freeway. McMillan reports that sales at the Detroit Whole Foods are double initial estimates, and the company is looking to open a second location within city limits.
Which, is, in a nutshell, the story of Detroit right now. The city gets something — a Whole Foods, a tech-happy billionaire — and a flurry of articles proclaims Detroit a phoenix rising from its own ashes. What these articles tend to ignore is that while one-third of Detroit’s population lives below the poverty line, it has also always, even through its worst economies, had its middle and upper-class neighborhoods. Midtown, as one of the few walkable neighborhoods in the city, was well on its way to becoming another one — even without the Whole Foods.
McMillan’s point is that Detroit’s problems lie less in access to food than in a basic truth — there are a lot of broke people in this country right now. Until that changes, putting a shop like Whole Foods into a low-income neighborhood is just going to give the not-low-income people nearby a new place to shop.