New Cooperatives and New Alliances

As before, recognition of changed conditions and thinking outside the co-op is needed. Concerning the economic breakdown, it’s likely you ain’t seen nothing yet. Local and state governments, much of their revenue dependent on taxing economic growth and on a pyramid of debt speculation, are facing a financial crisis as deep as that of the feds.

Nationally, following another election based on vote fraud, look for a continuing emergency and a regime offering more war and budget fraud (www.shadowstats.com). Consider the seldom discussed $4 trillion in federal programs that cannot be accounted for -- and that was before the $2 trillion in 2008 bailouts.

Whatever your personal outlook, the economy is on a downward slide that is likely to be enduring. Yet while food and fuel prices are volatile and mostly rising, local and organic continue to attract more support. Local and organic production also addresses underlying issues of resource conservation. After all, along with implosion of the empire of debt, it is increasingly scarce resources-petroleum, natural gas, water, soil-that will drive us all into new territory.

Food co-ops can take actions to better serve the growing portion of the population that is financially stressed, as discussed in the previous issue. This edition highlights additional opportunities in a challenging environment. Writers provide examples of deepening and expanding the cooperative community. By “expanding,” we mean not merely more sales but more co-ops and a broader impact, in markets and alliances that extend beyond current co-op community.

Products define a niche; ownership and service define cooperative purpose. Many co-op founders, as well as leaders and customers today, maintain a focus on natural and organic food, and indeed most food co-ops have grown and thrived in that niche. But these businesses also have learned repeatedly that fulfilling cooperative purpose requires owner capital and that the co-op’s fundamental orientation is serving member needs.

In the best cases, unsurprisingly, those cooperative elements lead to stronger ties in the local community. The story from Burlington, Vermont models the importance of emphasizing ownership, member service, and local business relationships. Renamed from Onion River Co-op, City Market took advantage of a remarkable opportunity to move from the periphery of their market to the downtown and into a store serving a much larger population. It wasn’t easy, but the co-op met this challenge impressively, and a summary sentence underscores their expanding the co-op identity and community:

"The crossover business model that was such a source of shame to many “co-op true believers” turned out to be a pleasantly effective business model."

Co-op fundamentals, rather than mutable product line assumptions, are the building blocks on which store development work is based. In the previous issue, national development director C.E. Pugh summarized growth strategies and identified forming new co-ops as one of the more risky directions. In this issue, Stuart Reid and others review how cooperative allies are strengthening resources and assistance to start-up ventures. Examples illustrate how existing co-ops have devoted significant resources to help grow new cooperatives.

Expanding the cooperative community and its impact also extends to local business alliances, such as the one formed in Milwaukee. Pam Mehnert describes how Outpost Natural Foods initiated a new coalition dedicated to promoting local businesses. From the point of view of Outpost, “our co-op” became “Our Milwaukee” through recognition of common ground with the local business community.

Another way to serve more of the local community is through the store meat department. A food co-op can enhance its customer service and ties to local producers by expanding this frequently underrepresented section. Robert Duncan of Sacramento Natural Foods Co-op presents the first part of a review of meat department basics.

Other business practices covered also bear directly on fundamentals of cooperative ownership and member service. The legal and tax definitions of ownership -- equity rather than liability -- are under review by national and international accounting standards boards, and cooperative practices are very much at stake. Mary Griffin of the National Cooperative Business Association reviews the issues being actively debated.

A final example of expanding the cooperative community is found in the report from PCC Natural Markets, which opened its ninth store in the Seattle area. Impressive eco-friendly store features and services enhance the co-op’s growth into underserved market territory.

Dave Gutknecht is editor of Cooperative Grocer (dave@cooperativegrocer.coop).