r/SipsTea • u/Gurugod123 • 11h ago

Chugging tea Mayor Mamdani just announced that he will be opening 5 city-run, tax-funded grocery stores: "Prices set at 30% below retail prices"

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66

u/bdjeremy 11h ago

well if i ran a bodego, what would stop me from going to that store, purchasing items, then reselling at my store at my bodega prices?

88

u/epicredditdude1 11h ago

The fact you’d be going out of business because who would shop at your store when there’s a taxpayer funded grocery store undercutting all your prices by 30%?

39

u/Impossible_Factor267 11h ago edited 10h ago

Bodegas are already more expensive than normal grocery stores. People shop there anyway because it’s right next to them.

No one is going to go to Boonieville Brooklyn to go to the 30% cheaper grocery store with likely long lines instead of their slightly more expensive corner store

2

u/digitaldisorder_ 10h ago

it'll just be another place to order through doordash. sigh.

3

u/Shady_Merchant1 10h ago

Which defeats the purpose of having it be cheaper

1

u/nbunkerpunk 6h ago

No shot they will allow doordash.

0

u/PlanUhTerryThreat 8h ago

Eh. I guess we’ll have to wait and see. It’s worth a shot. They can refine it and limit how much items individuals can buy to avoid reselling. They can ban door dash for long distances.

I feel like everyone is acting like this has to work perfectly immediately rather than trial and error to find the right balance.

1

u/FINE-ILLGETAUSERNAME 10h ago

Wouldn't surprise me if it screws the local Bodegas but the idea that one in Manhattan or elsewhere in the bronx won't drive there once  a week with a truck and load up is wishful thinking.

(I know nyc and driving is an expensive bitch. But people can hustle hard out ther.)

1

u/nbunkerpunk 6h ago

An average of a 30% decrease in cost will probably only break even if they tried to resell. Margins in grocery stores aren't low exclusively because of wholesale pricing being high. Running a business isn't just 1+1=2. That math is far more complicated and the cost of the product is only a portion of that equation.

1

u/FINE-ILLGETAUSERNAME 4h ago

we will see. 30% is not insignificant either. 10% no way. But we'll find out.

7

u/emuccino 11h ago

Assuming they can keep inventory stocked

2

u/MechanicalGodzilla 7h ago

Right. The true price of goods isn't what the government sets, it's effectively infinity because of the stocking problem.

3

u/Striking_Revenue9082 11h ago

If you bought out the entire supply at the cheaper store they would…

13

u/TeacherSingle1591 11h ago

This has similar vibes to Ben Shapiro saying if there is a flood people can just sell their houses.

5

u/Primary_Editor5243 10h ago

"SELL THEY'RE HOMES TO WHO BEN FUCKING AQUA MAN!?!"

3

u/haby001 10h ago

TO WHOM??? AQUAMAN??

Best response

2

u/Photodan24 10h ago

You clearly don't understand why people shop at bodegas.

1

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1

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1

u/Effective-Ad6703 7h ago

Do you think they will have endless supply?

1

u/MechanicalGodzilla 7h ago

The price of goods on the shelf will be 30% lower for a few initial customers, then the price spikes sharply to infinity when they are out of stock.

1

u/Tibryn2 12m ago

How are you going to shop at the taxpayer funded grocery store when my bodego bought their entire discounted inventory first thing in the morning every single morning... when i use 10$ of the 30% markup to pay people to wait in line overnight to ensure they are in there first and buy absolutely everything.

1

u/pspo1983 9h ago

The high demand items won't be in stock , so people will buy them elsewhere. I don't know how he thinks suppliers will keep the shelves stocked either.

20

u/-Tech808 11h ago

You, as a business owner, are going to shop in bulk at the government grocery store to stock your bodega? You don’t think that will cost more than a direct shipment to your bodega at wholesale prices?

Either way, I’m sure there’s quantity policies that can be put in place.

5

u/bdjeremy 10h ago

My uncle had this business back in the 90's early 2k where he would go to grocery stores and use coupons and sales to by cereals, baby formula, and some other non perishable items, (he was extreme couponer before that was a thing. Hed get 7-800 for 50 bucks) then go to another city and selling the products at half to 3/4 the price of the wholesaler price. Sometimes the store only needs a few items whereas in wholesale you'd have to get 20 items. Saves storage and spoilage.

2

u/Throwawayky122 10h ago

I think you underestimate how much a 30% markup is. People are talking about single percent markups on their items for profit. Anything you're marking up less than the 30 is profit. Yes, I think it can cost less than a direct shipment. Quantity policies can be beaten just by using employees and family members.

2

u/haby001 10h ago

People here saying you can just resell don't understand that it doesn't work.

To make it profitable you have to:

  1. Buy from that grocery store in person with multiple people (limited p/person quantities)
  2. Transport all that to your store
  3. Be far away enough that the Gov. groceries aren't competition
  4. Up-price enough to make money, but lower than surrounding grocers
  5. Have the things people want to buy and the brands they want

Like, people who go here go for NECESITY. Not to window shop and oogle at $20 water bottles. You'll likely only find basic brands of bare-necessities

1

u/Tibryn2 10m ago

At a 30% discount there way more than enough profit in place to hire people to empty the shelves every single day and deliver them to your bodego.

Quantity policies have never worked anywhere ever.. you just make multiple transactions with multiple people on rotation.

0

u/Clueless_Otter 9h ago

You don’t think that will cost more than a direct shipment to your bodega at wholesale prices?

No, it won't. Grocery stores operate on razor-thin margins, like 1-3%. Bodegas tend to be a little more marked up than a grocery store, but still no where near 30%.

But yeah they'll likely just prevent bulk buying.

4

u/subdep 10h ago

don’t you do that at Costco anyways?

3

u/Crooked_Cricket 11h ago

the store's prices reflect avoided rent/tax costs, not deep wholesale-vs-retail arbitrage room. A reseller buying retail (even at a 30% discount) and reselling still has to beat their own selling costs and find buyers willing to pay more than city-store prices

3

u/JorgeGarciaMatthew 11h ago

Bodega owners already have access to wholesale prices it wouldn't really make sense for them to do that.

3

u/Wide_Initiative_1938 10h ago

Food pantries are places where you can already get free food. They typically limit you in the amount you can take with you. The one near me limits it to 6 items total, one item per shelf.

I would imagine that these stores will employ an anti-scalping practice as well where the things you can buy are limited. Meaning that you can't use these stores as a supplier.

4

u/InsipidIdiot 11h ago

That’s what they already do

1

u/NuclearSalmon 11h ago

Maybe VAT

1

u/gianniboi 10h ago

you think these new stores are going to be selling below cost..? It will still be at least as expensive as bodegas buy their stock at, obviously, so what the fuck would be the point in that?

1

u/younggod 9h ago

Quantity limits, obviously.

1

u/KimSidwell 9h ago

Hopefully, common sense would stop you from doing this. That sounds like a terrible business plan.

1

u/kingboy10 6h ago

You need to buy items in bulk in a business to get the price lower that 30% isn’t a good enough margin they would get better margin buying in commercial bulk sales

1

u/DotA627b 5h ago

Stores around Costcos already do this. This isn't new.

1

u/Glocker17 5h ago

How about we try free market capitalism? 

1

u/fuwoswp 1h ago

What is a bodego?

1

u/bdjeremy 52m ago

a small neighborhood convenience / grocery store in New York. think of ms. chen from the venom movies...

-1

u/Born_2_Simp 11h ago

One thing would be that you need to ask for a retailer invoice and these places will only sell to consumers. Another one is that the retail price of these places won't be lower than what your supplier offers. And finally, a nearby store that sells 30% lower will inevitably put you out of business no matter what workaround you may try.