{"id":331737,"date":"2026-08-28T12:06:14","date_gmt":"2026-08-28T12:06:14","guid":{"rendered":"https:\/\/www.newsbeep.com\/us-ny\/331737\/"},"modified":"2026-08-28T12:06:14","modified_gmt":"2026-08-28T12:06:14","slug":"mamdani-oks-75m-grocery-deal-with-delivery-company-despite-unpaid-bills-complaints","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/us-ny\/331737\/","title":{"rendered":"Mamdani OKs $75M grocery deal with delivery company \u2014 despite unpaid bills complaints"},"content":{"rendered":"

Mayor Zohran Mamdani\u2019s administration is mired in yet another supermarket mess<\/a>.<\/p>\n

An online grocery platform that runs a city program for low-income households has stiffed Big Apple grocers to the tune of more than $1 million \u2014 even as the city seeks to enlarge the company\u2019s contract to a whopping $75 million, The Post has learned.\u00a0\u00a0<\/p>\n

San Diego-based Mercato \u2014 whose web portal lets eligible New Yorkers purchase fresh fruits and vegetables at a 50% discount from local grocery stores throughout the five boroughs \u2014 received $30.4 million over the past four and a half years from the city\u2019s \u201cGroceries to Go\u201d program, city records show.<\/p>\n

Mercato helped independent grocers to break into online shopping and delivery. Mercato<\/p>\n

Nevertheless, Mercato this year has failed to pay for more than $1 million in produce it delivered to customers months ago from dozens of independent supermarkets, including C-Town, Bravo and Key Food, according to store owners.<\/p>\n

\u201cI had to hunt them down and basically beg them for $10,000 \u2014 and they still owe me $4,500,\u201d said Anthony Diaz, who manages a C-Town in Williamsburg, Brooklyn.\u00a0<\/p>\n

In Queens and the Bronx, Mercato owes Jorge Guillen\u2019s two Cherry Valley Marketplace stores a combined $36,000, according to the grocer.<\/p>\n

\u201cThe impact on our business is huge,\u201d Guillen told The Post. \u201cIt affects my ability to purchase goods and pay my bills, so we had to find new financing. We took on debt.\u201d<\/p>\n

Despite the mess, the city\u2019s Department of Health and Mental Hygiene recently awarded Mercato a $75 million, six-year contract that was slated to begin in July, according to public filings<\/a>.<\/p>\n

Dozens of independent grocery stores are owed more than $1 million from Mercato, according to the National Supermarket Association. Wheree.com<\/p>\n

The health agency told The Post that it is \u201cunaware of delays in payments to supermarkets,\u201d according to a spokesperson.<\/p>\n

Approval of Mercato\u2019s new contract is being held up by the city Comptroller\u2019s Office, which has \u201coutstanding questions\u201d for the DOHMH, according to a spokesperson for Comptroller Mark Levine.<\/p>\n

Reached by The Post, the his spokesperson declined to elaborate on the agency\u2019s questions.<\/p>\n

Last year\u2019s $30.4 million contract with Mercato, which has been a city vendor since 2023, expired on June 30. According to the city\u2019s website<\/a>, the Groceries to Go program \u201chas been paused and is not enrolling new participants at this time.\u201d<\/p>\n

Guillen says he had a Zoom call about a month ago with Mercato\u2019s chief executive Bobby Brannigan. Guillen said Brannigan told him Mercato was running behind on payments because the city had been delaying its reimbursements to Mercato.\u00a0<\/p>\n

Anthony Pe\u00f1a, president of the National Supermarket Association. NSA<\/p>\n

\u201cUsually Mercato deposits the funds in 48 to 72 hours,\u201d Guillen told The Post. \u201cNow Mercato has not paid some NSA members since February.\u201d<\/p>\n

A spokesperson for the health department, however, said that based on a review of fiscal 2026 data, all invoices from Mercato have been paid on time.<\/p>\n

\u201cWe don\u2019t know why our members are not being paid,\u201d said Anthony Pe\u00f1a, president of the National Supermarket Association, which represents about 450 independent grocers in New York City.<\/p>\n

\u201cBut at the end of the day the city is not properly vetting a company that it is funding,\u201d Pe\u00f1a added. \u201cIt begs the question of what will happen with these public grocery stores.\u201d<\/p>\n

Pe\u00f1a referred to Mamdani\u2019s controversial, $70 million plan<\/a> to open a government-run supermarket in each borough of the city \u2014 a proposal that the NSA and other local grocer groups say will pose unfair competition for their already struggling businesses.<\/p>\n

Brooklyn-born Bobby Brannigan founded Mercato in 2015. Mercato<\/p>\n

Mercato \u2014 which also has operated in major cities including San Francisco, Chicago, Denver, Philadelphia, Austin, Texas, and Washington, DC \u2014 did not return multiple phone calls and emails seeking comment.<\/p>\n

Pe\u00f1a estimates dozens of NSA\u2019s members are collectively owed more than $1 million from Mercato, with many having waited months. Until this year, Mercato had been making regular payments to the grocers, including within days of deliveries up to a couple of weeks, he said.<\/p>\n

Local grocers said the 10-year-old company, which moved its headquarters from New York to San Diego in 2019, was a lifeline to some stores during the pandemic. Mercato signed up independent grocers that had not previously offered online shopping.<\/p>\n

\u201cI was grateful to them in the beginning,\u201d said Diaz of Williamsburg, \u201cThey helped me to survive when there were very few services for the independents.\u201d<\/p>\n

Brannigan, a Brooklyn native, told the San Diego Tribune<\/a> in 2019 that in college he launched an online business selling textbooks in 2001 \u2014 ValloreBooks \u2014 that grew to $100 million in sales. He sold the company in 2012 and invested in Uber and Twilio among other startups at the time, according to the report.<\/p>\n

Jorge Guillen owns two Cherry Valley Marketplace stores in Queens and the Bronx that are owed about $36,000 by Mercato. Wheree.com<\/p>\n

Aris Duran, who owns several Key Food locations in the city, was owed $45,000 at his College Point store in February. Mercato made small payments to chip away at the debt, but Duran got fed up and threatened to sue the company two weeks ago.\u00a0<\/p>\n

Suddenly he was paid in full with a check for $23,000, he told The Post. But he\u2019s vowed not to work with the company again, particularly since it charged him a $99 monthly service fee even when it wasn\u2019t paying for the groceries it had delivered to his customers.<\/p>\n

A spokesperson for the city\u2019s Department of Health said it is still assessing how to relaunch the subsidized program, which has been suspended since July 1.<\/p>\n

\u201cGroceries to Go provides eligible New Yorkers with critical access to affordable groceries online and for pickup or delivery. As prices of groceries increase, the importance of programs like this one have grown in need too. While the program has been temporarily paused, we are exploring our options so that these resources continue to reach New Yorkers in need.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"Mayor Zohran Mamdani\u2019s administration is mired in yet another supermarket mess. An online grocery platform that runs a…\n","protected":false},"author":2,"featured_media":331738,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8],"tags":[288,68,35407,57,9,56,63,65,64,29372,30006,9936,82],"class_list":["post-331737","post","type-post","status-publish","format-standard","has-post-thumbnail","category-new-york-city","tag-business","tag-exclusive","tag-food-delivery","tag-metro","tag-new-york","tag-ny","tag-nyc","tag-nyc-headlines","tag-nyc-news","tag-office-of-the-comptroller","tag-online-shopping","tag-supermarkets","tag-zohran-mamdani"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/posts\/331737","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/comments?post=331737"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/posts\/331737\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/media\/331738"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/media?parent=331737"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/categories?post=331737"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/tags?post=331737"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}