Proudly independent: co-ops give natural food shoppers a cost-effective choice.
Most retail, consumer food cooperatives trace their roots to the "buying clubs" of the late 60s and early 70s, founded by counterculture sorts seeking healthy, chemical-free food not found in supermarkets. Group buying not only improved selection, it saved money. By purchasing in bulk directly from grocery or natural foods wholesalers, and then splitting the large orders into family-sized portions themselves, members saved on both labor and retail costs.
As healthy eating headed mainstream, many of these loosely structured, members-only, nonprofit associations turned into retail stores open to the public. Full-time staff usually replaced member-labor with members remaining the owners. This means co-ops truly exist for the shoppers: trying to keep prices as low as possible while operating in a manner consistent with member values. Obviously, how each co-op handles these two goals varies.
Even after co-ops switched to professional management, they often remained informal and collectively run. They are, after all, nonprofits run by idealists (albeit, practical ones). For the most part, the laid back attitude hasn't hurt: Until recently, co-ops have thrived, secure in their small niche. But that's changing.
Ironically, it's the steep growth trend of the natural foods industry - 15 percent annually - that's fueled the rise of a savvy competitor: the natural foods supermarket. Although natural foods supermarkets aren't the biggest challenge to co-ops, companies like Whole Foods cover the same waterfront with considerably more money to spend on advertising, promotion and displays. Fresh Fields, for example, which was started by an ex-Goldman Sachs investment banker and one of the founders of the office-supply superstore chain Staples, is a well-capitalized mainstream business.
But, such chains expose the vulnerabilities of co-ops, which tend to be run intuitively and financed on a shoestring. In some sense, food cooperatives are victims of their own success. If they weren't successful businesses in the Wall Street Journal sense, they'd hardly be attracting competitors, including those with names like Super Stop and Shop and Grand Union which, hoping to capitalize on the "health fad," are stocking more similar fare.
The chains, says George Keller, publisher of The National Co-op Directory, are just riding the boom in natural foods sales that's buoyed the whole industry. To continue the success they had in the 70s and 80s - and, indeed, survive at all - Keller thinks that co-ops need to change how they do business. He's particularly enthusiastic about a Canadian co-op model in which members pay a monthly fee (about $20 in most cases) and then buy their food at cost. "Anyone who spent more than $60 a month would definitely save a lot of money," Keller enthuses, "and the store is assured of a steady flow of cash to meet expenses. The problem is getting people to buy into the idea."
Dave Gutknecht, publisher and editor of the trade publication Cooperative Grocer, sees the biggest advantages of a co-op coming from its local control and sensitivity to community needs. "Co-ops are more tied to the community," says Gutknecht.
Cooperatives whether they are formed for food retailers or producers, day-care centers or credit unions are member-owned and democratically controlled. The power and control that, in most corporate structures, is concentrated in a few hands, are spread among all the members of a co-op. As a result, co-ops can and do sponsor events that have nothing to do with making a profit - and can even lose sales. The Brattleboro Food Co-op in Brattleboro, Vermont, for instance, lets local organic farmers practicing community-supported agriculture (selling their produce directly to subscribing consumers) use its facilities for free.
If "you are what you eat" was the aphorism that built food cooperatives, let us hope "we become where we shop" propels it forward.
CONTACT: The Cooperative Development Institute, 50 Miles Street, Greenfield, MA 01301/(413)774-7599; University, of Wisconsin Center for Cooperatives, 230 Taylor Hall, 427 Lorch Street, Madison, WI 53706/(608)262-3981; National Cooperative Business Association, 1401 New York Avenue NW, Suite 110, Washington, DC 20005/(202)638-6222.
Publisher and editor of Green Living, MARSHALL GLICKMAN is the uncompensated treasurer and a two-term board member of the Brattleboro Food Co-op in Brattleboro, Vermont.
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|Title Annotation:||marketing cooperatives|
|Date:||May 1, 1997|
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