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Fruit Carts Are Killing Supermarket Business, Gristedes' Owner Says

By Shaye Weaver | November 12, 2015 2:36pm
 Fruit carts are killing business for local supermarkets by setting up outside of their doors, grocery store owners and residents say.
Fruit carts are killing business for local supermarkets by setting up outside of their doors, grocery store owners and residents say.
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New Yorkers for Street Vending Reform

UPPER EAST SIDE — Fruit carts are killing business for local supermarkets by setting up outside of their doors — forcing some stores to lay off workers to make up for the lost income, according to the owner of Gristedes and a group of residents.

Fruit carts have set up shop outside at least half of the Gristedes stores in the city and is costing the chain $7,000 a week in produce sales, according to owner John Catsimatidis.

"There are a lot of guys selling produce and my [produce] supervisor said he's laid off at least one to two people per every store they're in front of," Catsimatidis said. "It's not fair to anybody to have street vendors in front of the supermarket door that pay no real estate tax, nothing, and selling the same things these stores sell.

"We don’t want them to go out of business but they should be at least 200 feet away," he added.

And Gristedes isn't alone, according to New Yorkers for Street Vending Reform, a coalition of residents and grocery store owners fighting for better enforcement of street vendors and a limit on where they can set up.

A fruit cart is also stationed outside of the Morton Williams at 1066 Third Ave., and is undercutting produce sales at the market by roughly 20 percent, according to the group, which formed last September.

Morton Williams did not respond to a request for comment.

But Mohammed Hashmat, who sells fruits and vegetables from his cart outside the Morton Williams, denied that he is taking customers away from the supermarket.

"My customers are different from this store's customers," Hashmat said. "They're not the same because this store is expensive and this is cheaper. This is not for rich people."

Hashmat declined to reveal the prices of his wares.

Bodegas have also struggled with the competition at their doorstep, according to Zulay Mateo, the executive director of the Bodega Association of the U.S.A.

"Many bodega owners are going through this problem where street vendors with a similar product are selling right in front of or at the corner of the store," she said. "The bodega owner has rent, employees and insurance to pay — a lot of costs that vendors don’t have."

The coalition is concerned that the impact of street vendors will only get worse if the city decides to increase the cap on the number of permits the city issues, or eliminates it altogether — an idea that's been supported by a number of elected officials including Manhattan Borough President Gale Brewer and Council Speaker Melissa Mark-Viverito.

Community Board 8's Street Vendors committee slammed the idea during a meeting about the topic last month, saying an increase in permits would exacerbate quality of life issues like litter and sidewalk congestion on the Upper East Side. The committee is asking the city to take into account the impact on grocery stores before making any changes to the law, according to Michele Birnbaum, co-chair of the committee.

But street vendor advocate Street Vendor Project says the carts aren't competing with brick-and-mortar shops, but actually helping their businesses by drawing customers into the stores. 

A vendor can provide food to hungry shoppers, enabling them to continue shopping for longer, according to studies compiled by the group.

"Morton Williams, Gristedes, Food Emporium and their ilk are struggling because high-end companies like Whole Foods are moving into their turf and beating their butts with better selection and service," said Sean Basinski of the Street Vendor Project. "The Food Emporium at 59th and First Avenue, near where I live, just went under, and they have no vendor outside."