Small Town Success from Building Membership

Wisconsin’s Harvest Market is open for business!

The small community of Barneveld, Wisconsin (population 1,100), opened its grocery cooperative, Harvest Market Cooperative, on July 10, 2004 and had its grand opening on July 24. The store has a total of 6,000 square feet with approximately 4,500 square feet dedicated to retail.

In early 2002, Cooperative Development Services (CDS) approached some members of the Barneveld community to see if there was interest in pursuing a cooperatively owned grocery store. Previously, CDS had determined that rural communities were losing their grocery stores due to several factors: no succession for the small “ma and pa” grocery stores and the introduction of Wal-Mart super stores into more regions, to name two. CDS knew there was a possibility of obtaining federal funds through a grant from the United States Department of Agriculture (USDA) designed to assist rural communities in accessing food. One component of these grants was to explore the potential of offering locally produced products in rural grocery stores.

In May 2002, CDS Executive Director Kevin Edberg submitted a funding request for federal funds of $54,000 (and an equal amount of local cash and in-kind match) to the Community Food Security Grant program of USDA. The funding would be used to cover costs of feasibility analysis and business planning for the venture. In September 2002, the USDA approved the grant of $54,000.

Barneveld was without a grocery store for over three years. People had to travel a minimum of 16 miles round trip to have access to regular grocery items. The former grocery facility still existed with all the equipment, but no private individual had shown an interest in operating a store in the community. While there was excitement at the prospect of having a community grocery store, there was also concern about how this incarnation could be successful while the privately owned had closed (more than once). With the compilation of a community survey that offered a lot of ideas as to what this community wanted in their grocery store, and also what they did not like in the previous store, the type of store desired became clearer.

Through the process of determining the financial feasibility the Steering Committee (7–9 community members) was key in educat-ing the community about the potential benefits of a cooperatively owned store and also about the need for the community to support a store to ensure its success. The community already understood “you don’t know what you’ve got till it’s gone.”

There were many meetings over the next two years, with countless hours of volunteer time to bring the store to reality. The community used CDS for technical assistance along the way: market feasibility study, pro forma financials, survey, business plan, etc. The initial membership drive brought in over 300 members, at $100 equity investment each, and the member loan drive achieved a total of $91,000 in member loans. The local bank along with the county and community revolving loan funds supplied additional needed capital. The total store project was just about $300,000 including the $54,000 USDA grant, and it came in under budget.

There were a number of areas where community members pitched in and saved the co-op a lot of money by offering their services for free: logo design, accounting/bookkeeping, painting, plumbing and more. This was truly a community effort.

In March of 2004 the newly formed Board of Directors hired Terry Putnam as Harvest Market Cooperative’s general manager. Terry brought with him many years of experience in the grocery industry, and some of that time was spent in rural areas.

Said Putnam, “The community is embracing the co-op. We still have to overcome some folks’ perception about what co-op is (only natural foods) but most people are overwhelmingly positive. They are so happy to have a grocery store in town after so long without one.”

Harvest Market Cooperative is just a baby in the cooperative community, and it has so much potential, not just for Barneveld but for other rural communities.

See other articles from this issue: #114 September - October - 2004