Bloomberg, News, March 13, 2015
The groceries bagged, Dale Danahy offers a warm hug on this cold New England Saturday to a woman who has shopped Danahy’s store for 30 years. Hugs happen again in frozen food. Over by the bakery and in the meat section, Danahy is saying goodbye to a life inspired by a father who mixed his hard work with fun.
At 59, she is president of Colella’s Supermarket in Hopkinton, Massachusetts, a place the world knows as the start of the Boston Marathon. Locals know it better as the home of the full-service grocery and liquor store at the heart of Main Street that is closing down after 70 years.
Danahy has been part of the operation for 45 of those years, starting at age 14 in the produce section. Over the decades, she and five sisters all put in their time. Three stayed on, expanding and updating as late as 2010 with a $1.5 million renovation to stay ahead of looming competition.
It’s a story told everywhere. The number of single-location grocery stores dropped by 3,000 from 2002 through 2007, according to the most recent U.S Census data. The trend ought to show as big or bigger in new numbers due later this year, according to Stacy Mitchell of the Institute for Local Self-Reliance.
The buying power of bigger chains like Wal-Mart Stores Inc., with annual grocery revenues of $156 billion, is so strong that grocers in tiers below have been forced to consolidate, said Mitchell, co-director of the Minneapolis-based advocacy group. What’s left is an impossible pricing environment for places like Colella’s, whose $13 million in gross sales in its best years has dropped well below that.
A self-described workaholic who’s run the Boston Marathon four times, Danahy talks with a heavy heart about the 2011 arrival in town of Price Chopper, a 134-store chain based in Schenectady, New York. Price Chopper grabbed more than 10 percent of her business. For a profit margin that never gets better than 2 percent, that’s a nightmare.
And credit card fees? Please. Danahy paid out $110,000 last year, blaming, in part, the younger generation’s disdain for cash. A boy recently wanted to use his card to purchase an 89-cent bagel. An older woman behind him in line handed him a dollar. Here, she said, save these poor people the money.
The profit squeeze pinched the payroll. Danahy’s staff at Christmas was 45, down from an all-time peak of 82. She’d have kept a few more for the customer service she prizes but good help has been harder to find.
Growing up wasn’t easy but it was fun, said Danahy, who’s 5-foot-4 with close-cropped black hair. Her paternal grandparents came from Italy and eventually to Hopkinton, where they bought 100 acres to farm. Their son, Daniel, went off to World War II and came home with a Bronze Star, a couple of Purple Hearts and burning desire to make good.