NCGA Focused on Realizing National Potential

From #106, May-June 2003

NCGA Focused on Realizing National Potential

B Y   T H E   N C G A   B O A R D   O F   D I R E C T O R S

The National Cooperative Grocers Association (NCGA) board of directors recently met to discuss several important initiatives that are in progress at the national level. The meeting also included a discussion concerning the board's role as the link between the organization and the membership and specifically how the board can better report to the members on board activities and decisions. The board committed itself to reporting after every in-person meeting on each meeting's critical issues and outcomes, as well as identifying opportunities to engage the membership in the process of building a thriving retail food cooperative system.

Over the past eighteen months, NCGA has been identifying and developing programs that can be offered to members in order to increase members' net earnings and to strengthen their competitive presence in their marketplace. Two programs that are in the developmental stage include the Co-op Brand Project and a National Purchasing Program.

Co-op branding

The Co-op Brand Project grew out of the initial intention to create a private "Co-op" label program that would be commodity product driven and would focus on, for example, soy milk and canned organic tomatoes. However, as the business plan was developed and research progressed, it became apparent that a traditional private label approach would involve many obstacles that could not be addressed within the current structure of cooperative collaboration. Research also indicated a consumer-based branding approach could prove equally or more valuable than our original plans.

The concept behind the new branding approach focuses on creating a message for food co-ops that resonates with both core wellness consumers and reaches out to the mid-level wellness consumer population. This will "expand the circle" of food co-ops' reach into the wellness market and draw a new customer profile into our stores. This strategy doesn't require the same critical mass of participation as the former commodity product program. More specifically, the participation needed in terms of commitment to purchasing product quantities will not be necessary.

Although still in the developmental stage, the program characteristics will be menu-based marketing, so that the deliverable message is wide-scale but does not replace the individual stores' commitments to their own local promises. The program will provide enough guidance to work in an individual marketplace while recognizing that stores may not use all guidelines.

The Co-op Brand Project will develop a message targeting "mid-level" shoppers whom we'd like to attract to our stores, a message that is also resonant with the beliefs and value systems of our existing core consumers. The strategy will be to develop a common message throughout the co-op community, with "Co-op" as a macro-brand that enhances an individual store's marketing efforts. NCGA will provide materials that can be customized at the store level.

Members will have the opportunity to learn more about the Co-op Brand Project and an opportunity to provide feedback at the Consumer Cooperative Management Association (CCMA) conference in early June. NCGA's goal between now and June is to develop the following Co-op Brand Project components for CGA members:

• National brand treatment and promotion
• Member communication
• Merchandising recommendations
• Materials for outreach
• Early planning for product phase
• Program parameters
• Cost
• National purchasing-national structure

In October, the board of directors passed a resolution to move forward on a National Purchasing Program. The board recognizes that there are opportunity costs in not pursuing this initiative in a timely way. We need alignment among the CGAs to make national purchasing viable. However, our current collaborative structure, with the majority of resources focused regionally, inhibits our collective ability to undertake a project such as a National Purchasing Program. In exploring the potential benefits of a national core cost-of-goods purchasing program, the NCGA board soon realized that in order to move forward, the limitations of our current structure would need to be addressed. The board began by drawing on work done at national food co-op strategy sessions that had taken place over the previous two years. During those strategy sessions, varying models of collaboration had been discussed.

The NCGA board then worked to create a list of fears and obstacles that would need to be overcome in this process. At another national strategy session in fall 2002, cooperators from around the country worked to create a list of criteria to which change in structure would have to conform. The NCGA board came away from that strategy session with information needed to proceed with securing assistance from outside of the food co-op sector to study our current systems of collaboration, as well as to assess proposed options.

Currently, NCGA is addressing the factors cited by board members as significant to building a successful program. Of primary concern are the impact on CGAs and their executive directors, the impact on existing purchasing contracts and programs, and the impact on the current structure of regional and national associations.

NCGA will commission an outside analysis that will help determine the best options for moving forward. At its recent meeting, the board defined the structure parameters on which an outside party would be directed to focus. In order to arrive at this, the board listed necessary characteristics of a successful structural model. Each characteristic was weighted for significance to the whole of the model. The members of the board and NCGA's executive director selected four models for evaluation. After rating the options against the criteria, the top three were selected to be included in an analysis of change.

• Merger of NCGA and CGAs
• Federation model with stronger accountability between regional CGAs and the NCGA
• Status quo

To advance efforts to establish a successful national purchasing program, the board will seek outside expertise to study the impact of change on service, staff, and accountability, and to create financial models illustrating the dollar impact on the system. Recommendations will be presented to the regional CGA executive directors for comment, and the board will deliberate on all information provided. The board will make a recommendation to the CGAs and encourage a process of discussion within each CGA, and the full membership of NCGA will make the ultimate determination of how to proceed.

Other NCGA matters

The board supports the idea of developing and holding an annual NCGA member conference to promote national strategic planning, linkage between our various regional associations, and cross-pollination of activities based on store size and format.

On behalf of NCGA members, the board issued a statement announcing support of legislation to repeal Section 771 of the Omnibus Appropriations Bill by the United States Congress, which recently granted an exemption to the newly enacted USDA Organic Rule, on behalf of NCGA members.

The 2003 NCGA Annual Member Meeting will be held jointly with CGIN on Thursday, June 12th at CCMA in Lexington, Kentucky.

NCGA Board of Directors

Holly Jarvis, NWCGA
Food Front
Portland, Oregon

Paul Cultrera, PCGA
Sacramento Natural Foods Co-op
Sacramento, California

Randy Lee, PCC Natural Markets
Seattle, Washington

Michelle Schry, CGAMW
People's Food Co-op
La Crosse, Wisconsin

Dan Foley, TCNFC
The Wedge,
Minneapolis, Minnesota

Patrice Jennings, CGANE
Greenstar
Ithaca, New York

Ruffin Slater, SECGA
Weaver Street Market
Carborro, North Carolina

C.E. Pugh, 4 CCGA
La Montanita
Albuquerque, New Mexico

Walden Swanson, Advisor

Corinne Shindelar, Advisor

The Co-op Brand Advisory Group

Elizabeth Archerd (Wedge)
Matt Hartz (New Pioneer)
Rosemary Fifield (Hanover)
Kelly Wiseman (Community Food Co-op)
Lisa Malmarowski (Outpost)
Pat Cumbie (TCNFC)
Robynn Shrader (NCGA)

 

 

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Publisher and Editor: Dave Gutknecht dave@cooperativegrocer.coop
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