Korean grocery stores, long a mainstay of the Korean economy in America, are losing income rapidly. Especially in the Northeast, grocers are suffering from the continued economic recession, with some reporting drops in sales income from between 15 and 30 percent. This is forcing many businesses to close their doors.

The situation is widespread and brings with it serious implications. In Philadelphia, for example, the grocery business has been almost single-handedly responsible for building up the economy of the Korean-American community. Ever since the earliest days of Korean immigration to America, grocery stores have been the entry-level business of choice for countless numbers of Korean immigrants. Through the steady presence of their groceries, Koreans have added stability to neighborhoods experiencing ethnic change. Grocery stores provided Korean immigrants not only a precious foothold in their new country, but the opportunity to achieve economic independence. These ma-and-pa-run groceries have become almost cultural stereotypes in inner-city life. In some ways, Koreans inherited the role once held by local, neighborhood Jewish merchants. Through hard work and sacrifice, Koreans in Philadelphia managed to increase the number of groceries to over 1,000. Now, however, there are as few as 150 left.

“So many Korean owned grocery stores are gone. A few large Korean-owned groceries remain, but even these are buckling under huge economic pressures. At the same time, we are seeing a new wave of small groceries – owned by immigrants from Central and South America,” explained grocery store owner Young-son Kwan.

Mr. Kim, whose store is located in a predominantly African-American neighborhood, said, “The grocery business is at an end – at least for Koreans. Retail prices can’t keep up with wholesale prices. Large supermarket chains are expanding everywhere and drawing customers away from small grocery stores. Customers are looking for better bargains and cheaper prices. With retail prices so high, we have even gone so far as to buy some of our stock from supermarkets. Still, sales are declining. Things are very difficult. It’s hard to imagine the economic situation being this bad – customers are trying to save every penny they can. In all, we’ve seen drops in sales from between 15 and 30 percent.”

“My customers are really concerned with prices these days,” said Mr. Choi, who owns a grocery store in North Philadelphia. “This situation has also forced me to buy stock from large supermarkets; otherwise, I can’t keep my prices down, and I will lose more customers. Right now, business is not bad in quick sales – someone coming in for something they forgot, on the way home. But almost no one comes in to do regular grocery shopping for the week. I would like to get rid of this store, but I can’t find a buyer!”

According to Mr. Chang-hee Lee, former president of the Korean Grocery Association in Philadelphia, “The solution to the current problem is expansion. Korean groceries must expand to remain alive. It’s that simple. They must become large markets. But no one can afford that. We try to buy as much as we can from wholesale distributors. That works for companies like Coke or Pepsi. But we can’t run stores on soft drink sales alone. Since stores can’t expand, it may be possible to create a new niche for survival – making our stores different from major supermarket chains, with which we really can’t compete anyway. But improving services or creating new special delis or convenience outlets also requires major financing and it’s just not there right now.”

Like their counterparts in Philadelphia, Korean grocers across the Northeast are in deep trouble, with many being forced into closing their stores. There is a real fear among Korean grocers and grocers’ associations that, unless a solution to the current problem is found, Korean groceries may soon disappear from the landscape.

Grocers in Manhattan are doing everything they can to survive these dismal economic times, but with high prices for goods, rent increases, and the middle-class exodus from the city, both sales and profits are dwindling. With other Korean businesses, such as cleaners and laundromats still holding on, things are not quite as bad yet in New York as they are in Philadelphia, where there are fewer Korean-owned businesses.