Grocery stores worry about Trump's pullback on SNAP
Grocery retailers around the country have growing concerns about President Trump's plan to reduce food-stamp spending by $130 billion over the next decade, reports the Wall Street Journal. That would amount to a 20% reduction in the program's $63 billion annual budget.
Why it matters: Retailers are already facing stiff competition from grocers like Whole Foods with Amazon's backing. Now, they may lose sales from low-income consumers because of regulation.
- More stringent requirements would reduce the number of consumers who are eligible for the food-stamp program.
- Rather than receiving benefits on cards, food stamp users would receive benefits in boxes of cereal, beans, canned fruits and other government purchased food through wholesale channels.
- The food industry operates on a 1% profit margin, Alex Baloga, chief executive of the Pennsylvania Food Merchants Association, told the journal. Any SNAP loss could be devastating to the industry.
- The nation's biggest retailers would lose key revenue sources.
- Purchases at big box stores like Walmart and Target accounted for 52% of dollars spent through SNAP in 2017.