Commentary

The Living Poem to Capitalism

This article appeared on Techcentralstation.com on May 31, 2005.

The Gazette, a business journal for the counties of Maryland surrounding Washington, D.C. reported recently that Maryland’s wealthy suburbanites are driving 25, sometimes 30 miles to go, of all places, to the grocery store. They motor past what would likely be a dozen Giants and Safeways, past quirky grocers like Trader Joe’s, and several other higher-end stores like Whole Foods and Harris Teeter, all the way out to Sterling, Virginia.

They’re going to Wegmans, a grocery store based in Rochester, New York, that’s slowly spilling down the Atlantic Seaboard. In D.C., Wegmanites will battle notorious D.C. traffic, late nights (the store’s open — and typically busy — until 1am), and lost time (a premium for Beltway types) to get there.

So what is it about Wegmans that’s so appealing?

Start with the assault on the senses that is its “Market Café.” Upon entering, you’ll feel a little as if you’ve stumbled into an open-air European market. Commerce bustles all around you. It has all the fresh goods, delightful smells, and vivacious colors of an ageless community market, but at a variety and depth only modern advances in technology, agriculture, and shipping can provide. The place is a living poem to capitalism.

It’s often said that you shouldn’t go grocery shopping while hungry. Not a problem, here. Choose from a hot Asian bar, a pizza bar, a buffalo wing bar, a salad bar, and shops with prepared soup, sandwiches, pizza, or an entire meal. Try the fruit bar, the grain bar, or the cappuccino bar. There’s a Patisserie (an authentic French pastry shop), a sushi bar, and a bakery. Elaborate deserts beckon, trimmed with riveted curls of shaved chocolate, or dark swirls of reduced fruit toppings. Chefs regularly put on cooking demonstrations. And yes, there are occasionally samples available for tasting.

Move past the hot foods, and find a deli stocked not only with your basic hams, salamis, and turkey breast, but also with the most exotic and obscure French, Italian, and German meats a shopper can conjure. Each store boasts 500 types of cheese. There also 700 varieties of fresh produce, from heirloom tomatoes to truffles that go for hundreds of dollars a pound. The store tries to buy locally, to keep down shipping costs and keep things fresh. There’s a mozzarella bar, an olive bar, a pepper bar, and a hummus and Middle Eastern bar. There’s a wine section, and a wine-tasting room. The store’s prepared foods section is run by a former chef at the Ritz-Carlton. There are rows and rows of fresh meat of all kinds, at all levels of preparation — every cut, basted in dozens of marinades, stuffed, half-cooked, and fully cooked.

Wegmans is a grocery store, of course. So it stocks all the usual toiletries, packaged foods, spices, kitchenware, and the like we’ve come to expect from a mega-grocery. But despite its considerable high-end and hard-to-find offerings, Wegmans prices on most day-to-day goods are actually on par with or lower than its competitors. The store keeps its aisles wide, for easy cart maneuverability. It offers a holder in each cart for fresh flowers, to keep them from getting smooshed by the ice cream. It boxes up perishable items at the end of each day and sends them to local homeless shelters. The store’s seasonal magazine begins by listing areas in which the company feels it has failed, and offers solutions as to how it might do better.

Wegmans treats its employees well, too. In 2005, Fortune magazine named Wegmans the best company in America to work for. In fact, the grocery has made the list every year Fortune has published it.

This supersized souk (it’s twice the size of most large grocery stores) has its competitors worried. And rightly so. In its first year of operation, Wegmans’ first D.C.-area store did more business than the six area Harris-Teeter stores combined. Forbes wrote in 2003 that in an era when traditional grocers are being devoured by Wal-Mart, Wegmans isn’t merely surviving, it’s thriving. The grocery industry has lost 13,500 stores since 1992, Forbes points out, yet Wegmans continues to open new ones. That has the D.C.-area’s traditional grocers worried. And so they’re looking to government to keep their competitor at arm’s length — or at least across the river in Virginia.

The Gazette article reports that Marylanders are “begging” for a Wegmans. Both the company and the Montgomery County council have gotten numerous letters pining for one. Unfortunately, their government isn’t serving them. Montgomery County Executive Doug Duncan has introduced legislation making it more difficult for “big box” stores like Wegmans (along with Target and Wal-Mart) to set up shop in the area. Duncan cites concerns about “smart growth” policies, environmental concerns, and traffic as reasons for his proposal. The latter is rather peculiar. The philosophy behind big box stores is that they offer lots of things in one place, saving time, hassle and — one would think — gas and traffic congestion.

Nevertheless, when the progressive (read: big government) county council held hearings last summer on the new proposal, representatives from the two stalwart grocers in the area — Giant and Safeway — asked for tougher zoning laws, almost specifically tailored to the goal of keeping a Wegmans from opening in the county. Both cited congestion and infrastructure issues, but both also rather bluntly conceded that they were also worried about the competition. They were more than okay with using regulation to step on a competitor.

That’s good business, I guess, but it’s bad policy. Especially for consumers. The funny thing is, even while fighting the store’s expansion, Wegmans’ competitors have taken notice of its success. Earlier this year, Safeway announced a new ad campaign, logo, and that it would be renovating most of its stores over the next few years. According to the Washington Post, the new stores “will get hardwood floors, subdued lighting and spruced-up produce, delicatessen, bakery and floral departments.” The store has also begun to tout its use of locally-grown produce. In other words, it’s making itself more like Wegmans.

What’s happening in Montgomery County is likely to repeat itself all over the country. Last year, Wegmans released 7,000 letters written by consumers across the United States, each pleading for the company to open a store in their community. Wal-Mart’s superstores are already pervasive, but bloody zoning battles have heated up where it has attempted to penetrate urban markets in places like New York, Detroit, Chicago, and Washington, D.C.

City officials and politicians then have important choices to make. Do they give consumers what they want — low prices, variety, and good service? Or do they punish consumers and stifle competition in an effort dictate some idealized notion of “smart growth” or an anti-corporate aversion to big-box retail?

Montgomery County went on record with its answer. The county council unanimously approved the anti-Wegmans proposal last November. Accordingly, many of its residents will continue to drive to Virginia to do their grocery shopping.

Radley Balko is a policy analyst at the Cato Institute.