An organizational ecology approach to new food marts in New York City neighbourhoods

ABSTRACT

Global forces have disrupted local businesses across cities, but neighbourhood convenience stores and small grocery stores have proven to be resilient in the face of economic and institutional pressures. In this paper, we integrate urban retail and organizational ecology perspectives and examine small independently-owned convenience and grocery stores, colloquially referred to as food marts, as organizational populations that develop and persist in neighbourhoods across multiple decades. Drawing on data from the National Establishment Time Series database and the Decennial Census, we argue that a nonlinear relationship exists between the number of existing food marts and the emergence of new food marts. Furthermore, we examine how conditions such as the presence of chain stores, neighbourhood socio-economic conditions and ethno-racial composition affect the likelihood that new food marts will emerge in neighbourhoods. Our results show that the emergence of new food marts in neighbourhoods is strongly influenced by the existing number of similar firm types. In other words, we find that competition among new food marts strongly predicts the extent to which small food marts remain in neighbourhoods. The value our study is that we look beyond the individual firm and ask whether the entire population is at risk, for example when chain stores are present.

KEYWORDS:

• Bodega
• organizational ecology
• food marts
• neighbourhoods

Acknowledgement

Research for this article was supported by a grant from the Ewing Marion Kauffman Foundation. Thanks to the anonymous reviewers as well as Katherine Chen, Howard Lune, James Mandiberg and Celina Su for comments and feedback that vastly improved this manuscript. All errors belong to the authors.

Disclosure statement

No potential conflict of interest was reported by the author(s).

Correction Statement

This article has been republished with minor changes. These changes do not impact the academic content of the article.

Notes

1 Bodegas are small mom-and-pop retailers that sell an eclectic assortment of grab-and-go items, non-perishable foods, and household and personal commodities.

2 Throughout this paper we use the terms independently-owned and independent retailer interchangeably when referring to a small business or a retail enterprise that is not a corporate chain store, franchise or big-box store.

3 While there is overlap between organizational ecology and agglomeration economy arguments, they are distinct. Agglomeration studies focus on micro-oriented processes such as market entry and exit of individual firms. Organizational ecology is macro-oriented and attentive to the birth and death of firms in an organizational population. Consequently, the agglomeration model argues that firms accumulate benefits when they cluster. Organizational ecology proposes that if there are locational advantages, they are limited by the number of firms in that population (van Weissan, 2004). In addition, agglomeration arguments view profit maximization as the motive for competition, while organizational ecology surmises that competition is the process that determines the life chances of organizations (Hellerstedt, 2010).

4 We experimented with different time lags and found them to be correlated with tract-level variables.

Additional information

Funding

Research for this article was supported by a grant from the Ewing Marion Kauffman Foundation.