APRIL 2006

the food stamp
factor
One small change has caused a domino effect with grocers
Many Chaldean retailers know the first of
the month means all employees will be
needed and shelves must be stocked
because business will be booming — customers
just got their food stamps.
This way of distributing government dollars to
purchase food has a domino effect on the food
industry and the players on the food chain want
the method to change.
The Food Stamp Program payment method
comes once a month. A food stamp recipient
receives a plastic card called a Michigan Bridge
Card, which is credited within the first 10 days of
the month. This card allows withdrawals for food
purchases at grocery stores and supermarkets. The
store simply uses the EBT Bridge Card to “electronically”
subtract purchases from the food stamp
account. The recipient can only spend the
amount that is in the account.
SOLUTION PROPOSED
The Associated Food Dealers of Michigan (AFD)
is asking the Department of Human Services in
Michigan for twice-monthly payments. The AFD
represents 3,000 independent retailer locations
throughout the State of Michigan, many of them
among the 5,870 food stamp licensees in
Michigan. This month the AFD merged with the
Great Lakes Petroleum Retailers and Allied Trades
Association (see story on page 32).
“The AFD is urging that the Michigan
Department of Human Services implement a
twice-monthly electronic transfer of food stamp
benefits, which would make one half of food stamp
benefits available to a recipient in the first part of
the month and the balance of the monthly benefit
posted in the second half of each month,” said
Jane Shallal, president of the AFD.
The reason is actually simple. AFD members
who serve in high food stamp program areas report
that they have a number of customers who are
largely dependent on food stamps. Many retailers
and suppliers are doing 80 percent of food stamprelated
sales in the first 10 days of the month, as a
result of the current system. This has created an
enormous problem for in-store staffing, cash flow,
supplier delivery, and inventory and quality control,
especially with respect to perishable items.
BY VANESSA DENHA-GARMO
Additionally, employers (both retailers and suppliers)
are being forced to ask their employees to
work 50 or more hours a week for the first two weeks
of the month because of the heavy volume, with
limited work hours left available to employees in
the last two weeks of the month. This recommended
change is touted as helping retailers, suppliers,
wholesalers and manufacturers across the state by
easing the burden of financial and management
problems that result from the current system.
“Wholesalers and retailers see a big surge in our
business around that first of the month issuance of
food stamps, which requires everyone to ramp up
on staffing to handle the sales,” said Mary Dechow
of Spartan Stores. “After that surge, sales drop to a
level that will usually hold until the first of the
next month. It causes a real staffing issue for retailers
and wholesalers, and can also be an issue for
associates who end up working more hours early in
the month, but are short on hours later in the
month. It’s not only difficult for us to budget our
time needs, but it’s hard for employees to budget
their personal finances when their work
hours are reduced later in the month.
Changing the way foods stamps are
distributed would help immensely,
as it would level off the product
and staffing needs.”
At the end of the
month when the
money is gone,
some customers on
government assistance live
on what people say are gravy
and bread. Gary Davis, board
member of the AFD and general sales
manager for Prairie Farms Dairy, has
recalled countless stories of customers suffering
as a result of the food stamp distribution. “I
was at a store in Detroit, it is the end of the month
and these people walked up to the owner and
explained that they ran out of money and couldn’t
buy any food,” said Davis. “So, he grabbed some
bread and meat and gave it them. There are so
many retailers who are generous because of the
inadequacies in our system. Most people get paid
twice a month or every week. Very few people get
paid once a month. The system needs to change.”
CRIME FIGHTER?
The AFD is also receiving numerous reports of an
increase in crime against retailers in the second
half of the month, which Shallal said retailers
attribute to lack of funds for food purchases. “It
would appear that from a statistical standpoint,
most, and in some cases all, of the funds in a recipient’s
EBT account are used or depleted during the
first half of the month, leaving a small balance or
no monies at the end of the month for necessary
food purchases for the family,” she said. “The current
payment method imposes a hardship on recipients
who may have difficulty or lack savvy in
money management of a once-a-month payment.”
Fred Dally, chair of the AFD and owner of two
Detroit-based convenience stores, said the food
stamp situation has gotten worse in the past year.
“There are more people without work in Detroit
due to the economy and that means more people
are on food stamps,” he said.
Dally said when food stamps were distributed
twice a month in the form of books of paper
stamps, retailers didn’t report the problems they
have today with crime and the inability to staff
their stores properly.
“For example, it is difficult to keep fresh produce
in a store when customers are only spending money
in the first 10 days of the month,” said Dally.
“Because customers spend all their food stamp dollars
at that time, business decreases the last 20 days
of the month and we are unable to keep the store
stocked with fresh food.”
Davis agrees. “It is a challenge to stock a
store with our dairy products for the first 10
days of the month and have our trucks
jammed up, then business slows
down dramatically at the end of
the month and you can’t
keep fresh dairy in the
store,” he said.
The proposed
FOOD
STAMPS
continued
on 47
42 CHALDEAN NEWS APRIL 2006