At President Obama’s State of the Union address last night, Jeff Brown, a grocery store owner from New Jersey was sitting in the gallery with the First Lady. In something of a Washington tradition, every year the White House invites “real people” to attend the speech and serve as living examples of the president’s policy proposals. In this case, Brown was chosen because of the four Shop-Rite supermarkets he has opened in poor neighborhoods in Philadelphia, and for the White House he stands for creating jobs and supporting good health. His is also an excellent example of the kind of business model we promote here at Majority Markets: he is engaging with the base of the pyramid here in the United States.
America’s inner cities are sometimes called “supermarket deserts,” because large food stores that sell a variety of fresh foods at reasonable prices are few and far between in low-income urban neighborhoods. Instead, people there must make do with the limited and more expensive offerings at convenience stores and fast-food outlets. Brown’s Shop-Rite supermarkets are bridging this gap, which represents a smart business move for him and the community.
One of the president’s main messages in his speech was the need to create new jobs. Brown has created hundreds of good jobs in Philadelphia by opening stores there. Mrs. Obama must have also approved of inviting Brown, as one of her pet causes is fighting childhood obesity by encouraging families to eat more fresh fruits and vegetables and less junk food.
Jeff Brown’s Shop Rite stores in Philadelphia were established with help from local public-private partnerships. Brown helped start the Fresh Food Funds Initiative in Pennsylvania, which brings together the Commonwealth of Pennsylvania, the Greater Philadelphia Urban Affairs Coalition, the Reinvestment Fund and the Food Trust in providing grants and loans to encourage entrepreneurs to open food markets in underserved areas. Brown has met with White House staffers to discuss expanding the reach of the initiative.
In Mexico, Mi Tienda is doing similar work in primarily rural communities – creating jobs and providing quality goods in underserved areas. Through partnerships and support from investors (including the IDB’s Opportunities for the Majority initiative), Mi Tienda is working with its shopkeepers to help them develop their business skills, and is using regional warehouses to streamline its distribution networks to get a wider range of products in the shops.
Whether in the United States or in Latin America, whether in urban or rural areas, establishing quality food markets in low-income neighborhoods can have so many benefits: creating jobs, saving shoppers money, improving the health of the community, and connecting companies with a wider customer base. It was good to see the president showcase entrepreneurial business models like those of Jeff Brown and Mi Tienda on the night of the State of the Union Address. I hope this can serve as inspiration for other entrepreneurs in the region, and contribute to encourage private sector participation in majority markets.
Elizabeth Terry is an editor at MajorityMarkets.org.
