We’ve all heard stories about big-box stores making huge profits. A recent survey of U.S. shoppers shows many believe that grocery retailers are raking in about 35% profit. The reality for many grocers—including co-ops— is that profit tends to be around 2- 3%. That means after all expenses are paid, about 2-3% of the money made on sales is left over.
At Seward, we measure our sales and expenses every three months, which we call quarters. For many of the quarters since 2015, our profit has hovered around 0%. Sometimes our expenses have been more than our sales (a loss), and sometimes our sales have been slightly more than our expenses (a small profit).
But people shop all the time at Seward, so where does all that money go? Why isn’t there profit?
The money we take in at the registers goes to pay for three main categories of expenses.