Improving food access in rural communities

Rural homes dot the desert landscape, huddling here and there alongside arid, saguaro-studded arroyos and pinyon-pined mountains in Arizona's Sonoran Desert. Nestled within these remote communities is another kind of desert: the food desert.

These market-deficient communities that lack access to healthy, affordable food options aren't specific to desert topography, however. They exist across the nation in both urban and rural areas. What interests Lauren Chenarides, assistant professor at the Morrison School of Agribusiness, is Arizona's rural food deserts. She is studying the impact of existing policy solutions and interventions designed to remedy the problem.

Research proves that the food environment is a strong predictor of health risk. Individuals who live in food deserts and must travel long distances to a grocery store often exhibit higher rates of obesity and chronic disease.

Initial analysis revealed that 46 percent of U.S. rural counties not bordering an urban center had zero large supermarkets (a store with more than 50 employees). For nonmetro counties that are adjacent to an urban county, the number drops to 25 percent.

Why does it matter? "We should all have access to healthy food options," says Chenarides. "Research proves that the food environment is a strong predictor of health risk." Individuals who live in food deserts and must travel long distances to a grocery store often exhibit higher rates of obesity and chronic disease. Frequently, these families augment their weekly or bimonthly shopping trips with limited food choices at convenience, corner, and dollar stores or — if available — fast food restaurants.

It's all about the profits

"Whether a food desert exists comes down to demand," explains Chenarides. "That is a large contributor to whether a supermarket will choose to locate in an area. Can the demand support profitability?"

Two types of existing policies supported through the U.S. Farm Bill work to improve food access: supply-side policies (SSP), which offer subsidies and tax breaks to supermarkets to build new stores; and demand-stimulating policies (DSP), such as the Supplemental Nutrition Assistance Program (SNAP – formerly food stamps), which can increase consumers' purchases, and therefore bolster store sales.

Chenarides, along with colleagues from Colorado State University and Pennsylvania State University, analyzed both policy types to determine which were most cost effective for supermarkets considering entry into nonmetro markets. They culled 16 years of public data from 3,300 counties in the United States.

The group investigated the impact of a $1 million intervention on both an SSP and DSP. In another scenario, they computed the impact of increased governmental SNAP coverage to a supermarket's profitability.

They applied a theoretical and empirical model that considered the minimum population necessary to financially support a new store. Their computations took into account a store's fixed operating costs and variable profits, number of nearby existing stores, and several socioeconomic factors including local wages, rent, property values, and percentage of SNAP enrollees.

Which works better: SSP or DSP?

The research revealed that cost effectiveness for both policy types depends upon three variables: 1) the presence of an adjacent metropolitan county, 2) the number of existing stores, and 3) the duration of demand-side (SNAP) coverage.

Metro-adjacent

"Supply-side interventions appear to be more cost effective when the retailer is located closer to a city, because the store can draw from the rural area and a larger metropolitan area beyond to support long-term profitability," says Chenarides.

Existing stores

Demand-side policies are preferred if there are no existing stores in a nonmetro county. "You need to have demand for a store to open, and even though a DSP doesn't actually increase a store's profits directly, it does stimulate demand. Therefore, lower numbers of customers are needed to keep one store profitable."

SNAP coverage

Food assistance dollars are meant to be a temporary solution until a family regains financial footing. While effective in providing food access, DSP can become costly — especially when a household uses SNAP benefits over time.

The future of the food desert

"There is no clear pathway to see how food deserts will be eradicated or whether that's an achievable outcome," says Chenarides. "And there is no one-size-fits-all for the most profitable solution." In some instances, improved SNAP coverage is more cost-effective than an SSP, but in others, the reverse is true — based on competition, demographics, and food distribution systems.

Food retailers should consider the types of government support available and whether they factor into location decisions. Study of urbanization levels, market saturation, the duration of food assistance programs, and the nuances of regional markets are also integral to successful market entry. Additional research is needed to understand individual shopping preferences and trends, as well as consumer barriers, including food preservation challenges, access to transportation, and product affordability.

Chenarides believes traditional retailers may not be best equipped to minimize rural food deserts. Dollar and corner stores may fill the void in the future by adding fresh fruits and vegetables; distribution systems may merge with the retail sector offering pick-up points at local churches; and online shopping may play a role in some communities. Even collaboration across institutions and agencies may provide viable solutions. The key, says Chenarides, is continued review of metrics and consumer behaviors.



Research by Lauren Chenarides, Assistant Professor of Agribusiness

Melissa Crytzer Fry
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