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Billionaire investor Mark Cuban turned to AI chatbot Grok on Monday to test the economics behind New York City Mayor Zohran Mamdani’s proposal for city-owned grocery stores, asking whether the concept could break even after estimating store margins and operating costs. <\/p>\n
Grocery Margins Leave Little Room For Discounts <\/p>\n
In a post on X, Cuban asked Grok which grocery products generate gross margins of 70% or more that could support a 30% discount, before questioning how much sales a store operating on 15% margins would need to break even. <\/p>\n
The chatbot responded, saying almost no grocery categories consistently generate gross margins of 70% or more, with even the highest-margin segments falling below that level. <\/p>\n
Don’t Miss: <\/p>\n
It also estimated that a focused assortment of higher-margin products could fit inside a 2,000- to 5,000-square-foot store. <\/p>\n
Excluding labor and employee benefits, it forecasted annual operating costs at roughly $25 to $55 per square foot, including rent, utilities, maintenance, and insurance, with costs potentially higher in New York City. <\/p>\n
Hey @grok<\/a> which grocery SKUs have 70pct or more margins that could be discounted to 30 percent off ?<\/p>\n How many sq ft would be required to sell all of them ? What would it cost to operate that size store, before personnel and benefits ? https:\/\/t.co\/lqiDDQYYRh<\/a> <\/p>\n \u2014 Mark Cuban (@mcuban) August 3, 2026<\/a> <\/p>\n Trending: Avoid the #1 Investing Mistake: How Your ‘Safe’ Holdings Could Be Costing You Big Time<\/a> <\/p>\n Can a City-Owned Grocery Store Make Money? <\/p>\n The assessment extended beyond store economics to the track record of government-backed grocery stores in the U.S. <\/p>\n Grok in response to Cuban said city-owned grocery stores have rarely succeeded in the U.S., citing examples including Baldwin, Florida, Erie, Kansas, Kansas City’s subsidized Sun Fresh, and several Illinois-backed grocery stores, many of which either closed or shifted to private operators after sustained losses. <\/p>\n In conclusion, the chatbot said purely government-run grocery stores have historically struggled to remain financially viable without ongoing subsidies or private-sector management. <\/p>\n See Also: Skip the Regrets: The Essential Retirement Tips Experts Wish Everyone Knew Earlier.<\/a> <\/p>\n Proposal Draws Fresh Criticism From Tech Leaders <\/p>\n Story Continues <\/p>\n Cuban had shared a post by All-In Podcast host Jason Calacanis on X, who criticized Mamdani’s proposal, arguing that grocery stores already operate on 1% to 2% profit margins and questioned the need for governments to subsidize the business. <\/p>\n Tesla Inc. and Space Exploration Technologies Corp. CEO Elon Musk also weighed in, saying AI and robots would eventually provide free goods and services, while calling Mamdani “a thief and a liar.” <\/p>\n Meanwhile, Rep. Ro Khanna (D-Calif.) defended Mamdani’s proposal, saying critics were blaming city-owned grocery stores instead of higher food prices driven by the Iran conflict and President Donald Trump’s tax policies. <\/p>\n Mamdani has proposed city-owned grocery stores across New York City’s five boroughs, with the city planning to issue requests for proposals to identify operators. <\/p>\n Image via Shutterstock <\/p>\n Read Next: Think you’re saving enough for your kids? You might be dangerously off \u2014 see why<\/a> <\/p>\n Building Wealth Across More Than Just the Market <\/p>\n Building a resilient portfolio means thinking beyond a single asset or market trend. Economic cycles shift, sectors rise and fall, and no one investment performs well in every environment. That’s why many investors look to diversify with platforms that provide access to real estate, fixed-income opportunities, precious metals, and even self-directed retirement accounts. By spreading exposure across multiple asset classes, it becomes easier to manage risk, capture steady returns, and create long-term wealth that isn’t tied to the fortunes of just one company or industry. <\/p>\n Arrived <\/p>\n Backed by Jeff Bezos, Arrived Homes makes real estate investing accessible with a low barrier to entry. Investors can buy fractional shares of single-family rentals and vacation homes starting with as little as $100<\/a>. This allows everyday investors to diversify into real estate, collect rental income, and build long-term wealth without needing to manage properties directly. <\/p>\n Realberry <\/p>\n Institutional-quality real estate has traditionally been difficult for individual investors to access. Realberry gives accredited investors direct access to private real estate opportunities <\/a>backed by a team with 35 years of experience, $3.4 billion in assets under management, and $481 million in cumulative distributions paid to investors as of Q4 2025, according to the company. With a portfolio spanning 13 million square feet across seven U.S. states, Realberry focuses on acquiring, developing, and managing real estate with an emphasis on long-term value creation while its principals often invest alongside clients to help align interests. <\/p>\n FarmTogether <\/p>\n Farmland has historically held its value through market volatility and delivered returns uncorrelated to stocks and bonds. For accredited investors, FarmTogether offers direct access to high-quality U.S. farmland starting at $15,000<\/a> \u2014 fully managed, with no landlord headaches. <\/p>\n Immersed <\/p>\n Immersed is building technology for the future of work through spatial computing.<\/a> Known for its AR\/VR productivity platform that enables users to work across multiple virtual screens, the company has grown to more than 1.5 million users worldwide. Immersed is also developing Visor, a lightweight headset designed specifically for professional productivity, positioning the company at the intersection of remote work, extended reality (XR), and next-generation computing. <\/p>\n Fundrise <\/p>\n Private real estate and private credit can add income and stability to a stock-heavy portfolio. Fundrise offers access to diversified private real estate<\/a> and credit strategies through an easy-to-use platform, with professionally managed portfolios designed to generate passive income and long-term growth. <\/p>\n Mode Mobile <\/p>\n Mode Mobile is changing the way people interact with their phones by letting users earn money from the same apps and activities they already use every day.<\/a> Instead of platforms keeping all the advertising revenue, Mode Mobile shares a portion back with users who engage with content, play games, and scroll on their devices. Named one of Deloitte’s fastest-growing software companies in North America, the company has built a large beta user base and is scaling a model that turns everyday smartphone usage into a potential income stream.\u00a0 <\/p>\n EquityMultiple\u00a0 <\/p>\n For accredited investors looking beyond stocks and bonds, EquityMultiple provides access to vetted commercial real estate deals starting at $5,000<\/a>,<\/a> with only ~5% of opportunities passing their due diligence process. <\/p>\n \u00a9 2026 Benzinga.com. Benzinga does not provide investment advice. All rights reserved. <\/p>\n","protected":false},"excerpt":{"rendered":"Benzinga and Yahoo Finance LLC may earn commission or revenue on some items through the links below. Billionaire…\n","protected":false},"author":2,"featured_media":131304,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[10],"tags":[65589,65587,6364,6867,44223,36991,9691,5245,65588,40559,2899,21156],"class_list":["post-131303","post","type-post","status-publish","format-standard","has-post-thumbnail","category-xai","tag-grocery-products","tag-grocery-stores","tag-grok","tag-gross-margins","tag-jason-calacanis","tag-kansas-city","tag-mark-cuban","tag-new-york-city","tag-operating-costs","tag-profit-margins","tag-xai","tag-zohran-mamdani"],"_links":{"self":[{"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/posts\/131303","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/comments?post=131303"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/posts\/131303\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/media\/131304"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/media?parent=131303"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/categories?post=131303"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/tags?post=131303"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}