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Mercy Gatuka is part of a rare group. The 48-year-old Black entrepreneur works in an industry where owners who look like her are few and far between.
She runs a grocery store.
Gatuka bought OK Produce in Reading Terminal Market with her husband Sam Gatuka in 2018, becoming one of very few Black grocery retailers in the city — and the nation.
“There’s a lot of learning curve,” said Gatuka, who immigrated from Kenya with her family in 2003. “But it’s something we really enjoy, being there physically and taking care of our customers.”
Nearly half of Philadelphia’s residents are Black, but there don’t appear to be any Black-owned supermarkets in the city. Some corner stores and produce stores have Black proprietors, but not the kind of operations that offer one-stop shopping.
That’s a national trend. A 2018 study revealed just 10 Black-owned grocery stores across the country. None were in Philly.
The city is working on it. Last year, the Department of Public Health awarded six food justice projects a total of $240,000. One of them was for Honeysuckle Products, which chef Omar Tate said he plans to open as a “Black Trader Joe’s” in West Philly.
More of Black grocers would be good for the city, said the two shop owners Billy Penn spoke with, suggesting this kind of operation could help reduce racial health disparities, combat food deserts, and serve as community hubs.
“Bringing healthy, affordable fruit to food deserts and creating employment at the same time,” said Arnett Woodall, who owns a grocery store in West Philly, “that should be a model for all communities across the country.”
But there are high barriers to entry — including breaking into an industry that’s traditionally been dominated by generational ownership.
Over the past decade, national and international conglomerates began taking over, but the Brown family still owns 11 ShopRite locations in the area, and the Collins family owns another two. Overall, just 2.5% of Philadelphia businesses with employees are Black-owned, according to a 2019 Pew report.
It wasn’t always this way. In the 1930s, grocery stores were the most common business to be owned by Black Americans, according to the book “Our Black Year” by Maggie Anderson. Segregation made them a necessity. Then the civil rights movement happened, and Black people could go to any food market they wanted. By the turn of the millennium, the number of Black supermarkets had dwindled to 19.
The biggest barrier to opening new Black businesses, Anderson writes, is often start-up capital. Gatuka from OK Produce has experienced it firsthand.
“My thinking as a Black person is, some of these grocery stores require a lot of money to open, to rent, to manage,” Gatuka said. “That funding isn’t readily available to Black people.”
‘A hub in every community’
Woodall thinks his produce shop could solve a lot of Philly’s problems.
He opened West Phillie Produce at 62nd and Ludlow in 2009 with a dual missions: to provide fresh food to the Cobbs Creek neighborhood, and employ youth to keep them out of trouble. He thinks it’s a promising model.
Anecdotally, Woodall said he’s seen a decrease in drug sales violence in the neighborhood. Rough data bears out his observation: In January of the year Woodall opened, police recorded 543 crimes. In 2017, that month’s total fell to 428. This year it was 286.
The shop owner is proud of keeping people busy and providing a watchful eye. Customers like the store too.
Natasha Harris is a West Phillie Produce regular. She visits every two weeks — even though she lives a 20-minute drive away in Olney. She loves the fresh produce, the seafood platters and the sense of community she feels inside.
“That’s very important to me, to give back to our community,” Harris said. “I think we should have more of it. It could be a hub in every community.”
Dedicated grant and loan programs could help make that a reality, said Temple accounting professor Wayne Williams.
With the understanding that Black-owned grocery stores might help alleviate food insecurity and health disparities, a combination of public and private programming could choose to invest in this arena, he said. Foundations could offer Black people start-up cash and entrepreneurship training specifically geared toward opening grocery stores in food deserts.
Some programs run by the city’s Commerce Department do already address this. Spokesperson Kevin Lessard recommended Black grocer-hopefuls check out:
- The Philadelphia Business Lending Network loans
- The InStore Forgivable Loan Program — which is competitive, but Lessard said Black-owned grocery stores would likely meet much of the criteria
- City-funded orgs that provide one-on-one business support
- Other entrepreneurial support programs
It’d be especially impactful, he said, because grocery stores are actually profitable in the pandemic.
“This is a unique opportunity that should and could emerge with a focused effort,” Williams said. “If you have a well-managed grocery store, you could account for operating expenses, payroll, lease and debt service, insurance and taxes and still yield positive net income.”