Small grocers feel squeezed by suppliers, and shoppers bear the pain

[mahatmakanejeeves]

Small grocers feel squeezed by suppliers, and shoppers bear the pain

Independent grocery stories, often lifelines in small, rural communities, try to scrape by on smaller margins while bigger rivals get better deals from wholesalers.


Independent grocers like Buche Foods are facing unprecedented challenges in the face of competition, industry consolidation and thinning margins. Here, shoppers scan the offerings at Buche Foods, the only supermarket on the Pine Ridge Indian Reservation in South Dakota, in May. (Eunice Straight Head/For The Washington Post)

By Jaclyn Peiser
August 25, 2024 at 8:05 a.m. ED

PINE RIDGE, S.D. — RF Buche, whose family has been running grocery stores in South Dakota since 1905, hears the complaints and can hardly disagree: Yes, prices are too high. But no, he insists, he isn’t ripping anyone off.

But many of his customers have a tough time reconciling how the head of Buche Foods — the only full-service supermarket on the Pine Ridge Indian Reservation, a stretch of plains larger than the state of Delaware — might not have the final say on store prices.

Buche says he understands the frustration but has little room to maneuver. Like other retailers, he’s had to contend with inflation, supply chain disruptions, consolidation and other fallouts of the pandemic. But as an independent grocer, his seven-store chain doesn’t have the purchasing power of a Walmart, Costco or Kroger to leverage wholesalers on price or priority. That’s why his shoppers can see a price differential of 20 percent to 100 percent on everything from potatoes to diapers.

“We have to defend ourselves against accusations of price-gouging and that really, really stings,” said Buche (pronounced BOO-ey), scanning the produce aisle as most shopping carts trundled by with one or more loaves of sliced white bread on sale that week, marked down {50} percent.

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Two Pine Ridge residents participate in a relay on the reservation, home to 32,000 members of the Oglala Sioux Tribe. Residents here don’t have easy access to national retail chains; the closest Walmart is 55 miles away. (Nikki Kahn/The Washington Post)

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By Jaclyn Peiser
Jaclyn Peiser covers retail for The Washington Post. She previously worked overnight on The Post's Morning Mix team and covered the media industry for the New York Times. Twitter

[Think. Again.]

1. yeah, the koch brother's company sucks.

[70sEraVet]

2. We have a Piggly Wiggly about 6 miles away in a small town to the West...

of our tiny town, and to the East of us is a small city with Wal-Mart and Kroger about 25 miles away.
I know that 'The Pig' (as it's affectionately called) can't compete with those major retailers. But the store has always been very good to the community, contributing to events and helping with local charities, etc.
I would like to do ALL my grocery shopping at the Pig, but our budget is a little too tight for that. So I do occasional trips to the city to buy some staples in larger quantities: laundry detergent, paper towels, coffee, etc.
I would hate to see these smaller stores that have served their communities so faithfully, forced to close their doors.

[bucolic_frolic]

3. We have some of those little retail grocers

They are inept at reducing the amount of labor in their merchandising, which is one reason they can't reduce costs. They pride themselves on being full service and I get it they're the only game around, but still reducing costs is the name of the game. Hot bar, deli. They're like a convenience store inside a grocery store, and their distributors and wholesalers have no pricing alternatives. It's a rigid system. You can't stock a store with food and slow moving merchandise and food and make it profitable and cheap for consumers. So the system continues until it collapses. Locally the retailer shuts down during some recessions. Then tries again when the economy turns up.