Carlos Collado, a Dominican immigrant who owns five independent grocery stores in the Bronx and Manhattan, has succeeded over the last three decades despite obstacles that he blames on local and state governance.
His stores have faced an increase in shoplifting, he said. The city has provided tax benefits to big corporations that opened grocery stores and took business away from his.
Now, he says, New York’s new mayor, Zohran Mamdani, will make it even harder for him and other grocery store and bodega owners to succeed because of his plan to open five city-owned grocers. The mayor announced additional details about the stores this week, which he said will offer produce, meat and seafood for 30% less than typical retail prices.
Existing businesses will not be able to compete, Collado and some others say. But there is also support for Mamdani’s venture, saying that the stores will bring much-need food options into areas of New York city sorely lacking in grocery shops and help with a crisis in soaring food prices that hits some of the city’s most vulnerable families the hardest.
Food costs in the United States have soared in recent years. In June, the average price of ground chuck beef was almost $7 a pound, an 83% increase over June 2016, according to the US Bureau of Labor Statistics. In the New York-New Jersey area, the consumer price index for food increased 33% from 2015 to 2024, according to the Federal Reserve Bank of St Louis.
Mamdani, a democratic socialist, has allocated $70m in the city budget to open the five grocery stores, one in each of the city’s boroughs. The mayor has announced the locations of two of the grocers: La Marqueta in East Harlem and La Peninsula in the Bronx’s Hunts Point neighborhood. The latter location will open by the end of 2027, he said. The city has not announced where the other stores will open.
Private operators would manage the ventures, and the city has issued a request for proposals, Mamdani said at a press conference on Monday.
“In the wealthiest city, in the wealthiest country in the history of the world, no New Yorker should have to worry about being able to afford to feed their family,” Mamdani said.
Supporters and opponents of the city grocery plan seem to agree with the mayor that food has become unaffordable for many people and that trying to solve the issue is a worthy cause. But they differ on whether the new grocery stores will help the average New Yorker.
Maria Torres, president, co-founder and chief operating officer of The Point, a community development organization in Hunts Point, said the predominantly Hispanic neighborhood was “basically a food desert”, so La Peninsula would not really threaten existing grocers.
As to bodegas, the city grocery will not offer cigarettes, alcohol, lottery tickets or hot foods, which means there will also not be much head-to-head competition, she said.
“I’m excited about it. I think it could be another way for folks to try to cut down on expenses,” Torres said. “We have too many folks that are unable to provide all the meals that they need.”
Others disagree.
“It’s going to really devastate the economic growth of the small minority ethnic business,” said Frank Garcia, the chairman of the National Association of Latino State Chambers, who is leading an effort opposing the grocery stores.
US governments have tried to open grocery stores in other parts of the United States with limited success. The small town of Baldwin, Florida, invested $150,000 in 2019 to open a market, with employees on the city payroll, to make it easier for residents to buy groceries in an area that was largely a food desert. While many people initially touted it as a success, the town closed the store in 2024 because it could not break even, the Florida Times Union reported.
In Kansas City, the local government invested almost $18m in a grocery store and shopping center that closed in 2025 because of crime increases inside and outside the store and slow sales, the local NPR affiliate reported.
Meanwhile, the city government in Atlanta opened a grocery in a former Walgreens last year, and it has received positive reviews. Fast Company described it as “an oasis in its downtown food desert”.
It’s hard for any food retailer to succeed because “it’s a very low-margin business”, said Stephen Zagor, an adjunct associate professor at Columbia Business School who focuses on food businesses.
The mayor’s request for businesses to apply to operate the stores could help because it would give the city “the ability to get really good large-scale pricing from their suppliers”.
“But that gain could easily be offset by the cost of having them operate it,” Zagor said.
The city will also have to contend with labor costs. Mamdani has appeared with organized labor leaders when announcing the grocers and said workers would enjoy “union-level standards”.
“These are going to be jobs where people can quote unquote make a living, which is nice to have, but in the reality of the business that he is supporting, it’s a big challenge,” Zagor said.
The stores could also be hindered by not offering hot foods. Profit margins tend to be higher for prepared foods, which have become a greater source of revenue for grocers in recent years.
“They are putting themselves in a box that is going to be very hard to break out of,” Zagor said.
But if the city grocer sells prepared foods, that would mean more competition for private store owners, who are already upset about the mayor’s plan.
Gustavo Gordillo, a chair of New York City’s chapter of the Democratic Socialists of America, didn’t help matters when he recently said on Fox News, “If one publicly owned grocery store that brings prices down in the neighborhood is enough to put someone out of business, then maybe they shouldn’t have been in that business in the first place.”
Andrew Rein, president of the Citizens Budget Commission, a non-profit watchdog group, said the city must consider that “small business owners are struggling to keep up in New York as well”.
While the stores could make it easier for people in food deserts to access affordable food, Rein said, the city should instead provide support, like an earned income tax credit, directly to low-income people facing food insecurity, many of whom lost access to Supplemental Nutrition Assistance Program food benefits because of cuts from the Trump administration.
“That would likely be more cost effective,” Rein said.
Also, some residents who might not be experiencing food insecurity could still decide to shop at the city-owned stores because they offer better prices than private businesses, Rein pointed out.
A spokesperson for the mayor stated in an email to the Guardian that Mamdani believes that “independent grocers and local bodegas are a critical part of the food ecosystem”.
The city is designing the grocery store “initiative to minimize competition with independent grocers and to find ways to support them”, the spokesperson stated.
The city picked sites that do not have enough grocery stores or fresh produce options to meet residents’ needs, according to the mayor’s office.
Asked about the failed city-owned grocery stores, the spokesperson stated, “Every approach has had a different design. We feel confident that the design of our program, from our site selection to our operator partnership model, will be successful in delivering fresh, affordable food for New Yorkers with a financially sustainable operating subsidy.”
The mayor’s administration has also arranged roundtables with bodegas, independent grocers, food policy experts and residents, according to his office.
If the mayor does not meet with members of a newly formed organization, the Multicultural Business Coalition, which includes representatives from various ethnic groups’ chambers of commerce, then they will sue him, Garcia, of the National Association of Latino State Chambers, said.
“He talks about sensitivity with immigrants,” Garcia said. “Who do I represent? Immigrants.”
