Discounts and Death

Myths die hard, and so do member discounts. In questioning this entrenched practice, reflexively equated with co-op membership in the minds of many, one never knows for certain what argument will penetrate: fairness, financial prudence, rational marketing, consistency with organizational mission. Each of these arguments is of value, although it is difficult to tie them all together.

Another problem is that discount adherents sometimes cannot hear any of these arguments, so engrained is their conviction. They seems to hold a founding and in some cases still prevailing attitude that the food co-op is a member-run operation, rather than it being a management-run operation serving the member-owners and accountable to the elected board of directors. So perhaps the fundamental issue is defining the organizational mission: What is the co-op's purpose and how is it to be realized?

These thoughts follow preparation of this edition's articles on discounts, on member empowerment, and on board training. I also recently read a co-op newsletter in which some members were arguing to change the existing policy of giving members of the board (a different term was used at this co-op) a thirty-five (35) percent discount on purchases; others were opposed to reducing this discount. Thus the co-op, operating at perhaps a 35 percent margin, is actually prevented from obtaining any contribution at all toward running the business from sales to these members. If one were to ask whether the cost of these discounts should be regarded as a board/administrative expense or as a labor expense, the answer might be, "Huh?"

Co-op member discount practices and expectations are examples of individual self-interest and immediate gratification. But a cooperative is something more, a whole greater than the sum of its individual members. The co-op is in large part a gift from those who preceded us, and we have an obligation to spread it around and pass it on. Its proper care must be defined and delegated.

Along with trumpeting new co-op stores, we might also play taps for the recently departed. Good Neighbor Co-op in Louisville, Kentucky closed in December after a long decline. That leaves one retail food co-op in the entire state, a comment on the level of cooperative development in our consumer culture.

Another recent demise had a more postive outcome for co-ops. In January, Clear-Eye, originally a worker collective and for twenty years a small natural foods distributor in western New York, sold its accounts to Northeast Cooperatives. Northeast will extend services to the west of its historic territory.

See other articles from this issue: #063 March - April - 1996