Grocery store has a profit potential

by Sam Clegg

Friday, February 29, 2008 00:00

I don’t like anybody taking my money, especially not people with good intentions. Usually good intentions are nothing more than preemptive justifications for obvious failure later on.

Associated Students of Madison negated my original fears on Monday night, however, when Shared Governance Committee Chairman Jeff Wright made it clear during an information session that good intentions are not the business model with which ASM plans to run its grocery store, because it won’t technically be “running” it at all. As a matter of fact, despite all the editorial flak it has received, ASM has served in nothing more than an advisory role. For the sake of accuracy, the store would be more correctly described as the “Union Directorate grocery store.” ASM has merely provided suggestions — read carefully — suggestions to the Directorate.

The latest headache over the store, to be located in the rebuilt Union South, comes after the announcement that Roundy’s — a Wisconsin-centered grocery chain — will be moving a store in the soon-to-be complete Steve Brown Lucky Apartments complex on the 700 block of University Avenue. Mr. Wright stated that in light of the announcement, ASM would suggest that the Directorate continue with the grocery store but redefine the concept to include more specialty products such as locally grown produce and UW’s own Babcock Hall dairy items.

Mr. Wright also stressed in his appeal to the Union Directorate that the new store could stress environmental sustainability as part of its market appeal.

While using the feel-good appeal of a store to justify its financial sustainability is certainly worthy of skepticism, past examples such as Whole Foods and Fair Trade Coffee have exemplified the marketability of social concern. It would also be up to the Union Directorate to implement the suggestions.

The fact that the Union Directorate or any other private entity will be controlling the store means that any risk of failure will be assumed by a private enterprise, so students are in no danger of watching future segregated fees go to subsidize a student-run program doomed to become Union South’s graveyard of good intentions.

This no-risk promise from the Union Directorate is more crucial now more than ever with the announcement of Roundy’s because failure, while far from assured, is a possibility that deserves recognition.

One argument against the store is that ASM made out like a bandit, receiving $85.26 million to fund the construction of a new Union South, the store included.

But that argument wouldn’t be true, either. The Union Directorate received the money, not ASM, and they held a referendum in 2006 to ensure that students supported the use of their non-allocable segregated fees.

Students are assuming no risk whatsoever in the process, and it is economically feasible for two competing stores to capably serve a population of around 40,000 students. Even assuming that Roundy’s takes up a larger portion of market share — which it may very well do — there is no reason to think the Directorate’s store can’t succeed in a market of even 15,000 potential customers.

ASM — no, wait — the Union Directorate, has its bases covered.

Thus the image of an overzealous, monolithic student government gone insane in its lust for control could not be further from the truth. ASM’s role in the potential Directorate grocery store has never — nor will it ever be — anything more than advisory.

While it is far from a victim in the matter, ASM’s greatest misfortune in the whole affair is not a bizarre craving for control over the eating habits of students, but an unfortunate failure to downplay its significance in the matter.

Sam Clegg (sclegg@wisc.edu) is a freshman majoring in political science and economics.