Montreal’s 3 Paniers grocery store tests a new approach to pricing and social equity
Experimenting with consumer-based philanthropy at the grocery store level is an idea that fascinates both economists and social entrepreneurs. The idea of relying on consumers’ generosity and altruistic nature to help those in need while keeping a grocery store afloat raises important questions.
But can this approach truly succeed in practice?
A unique experiment is taking place in Montreal with the opening of an independent grocery store called 3 Paniers. This store offers three pricing options: the “Solidarity Price,” which reduces profit margins to make groceries more accessible for those on a tight budget; the “Suggested Price,” which includes a standard profit margin necessary for the store’s financial sustainability; and the “Pay-it-Forward Price,” which not only covers costs but also helps subsidize the Solidarity Price, supporting the store’s mission of social equity.
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The question remains whether many consumers will opt for the Pay-it-Forward option. While one can be hopeful, the reality may differ. Consumers, regardless of their financial means, often manage their food budgets in a variety of ways. Stores like 3 Paniers may attract individuals drawn to the mission, but their numbers are likely to remain small.
A similar concept was tested at The Anarchist, a self-described “anti-capitalist” café in Toronto, which operated on a “pay what you can” model. It closed last year after just over a year in business. Despite this, the idea has not disappeared. Another Pay-What-You-Can food market opened in Kitchener in June, aiming to improve food accessibility in the community. Numerous lesser-known initiatives across the country share this goal: how to encourage the more fortunate to support those left behind while grocery shopping. Yet, this remains an elusive concept that has not yet proven successful.
Altruism is more easily harnessed by food banks and food-rescue organizations like Second Harvest. However, integrating different socio-economic groups within a single grocery store has always been challenging. The idea of wealthier customers supporting the poor in real-time, as they interact within the same shopping environment, is precisely what these initiatives aim to achieve. While these concepts have the potential to create inclusive spaces that bridge socio-economic divides, they often face long-term sustainability issues. Human nature tends to focus on personal interests, so people are often reluctant to overpay for their own groceries to support others.
However, charitable activities such as this are already being done on a much larger scale, albeit without much fanfare. Despite facing criticism for years, major grocers like Loblaw, Sobeys, Metro, Costco, and Walmart Canada contribute significantly to food banks and food-rescue agencies. For instance, Metro, the smallest of the country’s big three grocers, donated more than $60 million to food banks last year. These companies, while profitable, also play a substantial role in supporting people in need, contributing to various initiatives such as child welfare, literacy, education, and housing.
Smaller social enterprises, on the other hand, focus on uniting communities by involving volunteers and fostering a sense of collective responsibility. It’s hard to argue against the value of these efforts. Most of us would like to see these enterprises succeed and thrive. Yet, making these initiatives sustainable will remain a significant challenge.
Allowing consumers to choose their price is certainly an intriguing concept. It’s just a shame we can’t do the same with our personal income taxes.
Dr. Sylvain Charlebois is senior director of the agri-food analytics lab and a professor in food distribution and policy at Dalhousie University.
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