Retail Rock and Roll

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This edition’s contents illustrate different angles on a fundamental aspect of today’s economic environment: grocery retailers cannot plan to stay in place if they plan to stay in business.

Information technology and its drive for greater efficiency certainly are among the familiar reasons for this change imperative. Payment card usage by customers is higher than ever. In addition to fees, payment card data reports and security are trade issues that are of increasing importance to all retailers. Chris von Rabenau, IT director for the National Cooperative Grocers Association, discusses the background and implications of the latest industry-wide agreements concerning payment card security.

Online ordering and home delivery also are growing in appeal to a certain customer segment, but such programs are rare among co-ops. The experience of Willy Street Co-op of Madison, Wisc. in offering both these services is discussed by Brendon Smith, that co-op’s director of communications.

Organics is a key component of most food co-ops’ market niche, and organics also is a grocery sector that continues to grow very strongly and to generate much controversy. A few of those controversies reflect failures of organic integrity, while many other statements and detractors illustrate media ignorance and even willful distortion of the facts about organic vs. conventional food production. Cissy Bowman, an organic grower and certifier, responds to a complaint from a major organic producer and to some misleading media reports.

Co-ops continue to lead in organic sales in many markets, even while other retail outlets now compete for those customers. Additional perspectives on selling organics during economic decline-an era now undoubtedly upon us-are provided in a summary of marketing tips, garnered on stops at food co-ops by Mark Kastel of the organic industry watchdog group, the Cornucopia Institute.

For co-ops in a highly competitive field, more retail management tools are available now than in earlier years, and this is a positive aspect of continual change. Mel Braverman, a consultant with Cooperative Development Services, highlights how department managers can better understand and control key variables that determine retail performance.

Remarkably, new developments among food cooperatives include forms of specialty distribution. This is occurring despite a long history of co-op distributors closing or merging with larger entities, a period that ended five years ago (except for Ozark and Tucson co-op distributors, which closed more recently). Our cover section explores how the increasing importance of reliable organic supply and an increasing emphasis on local producers has led two successful co-ops to venture into specialty distribution. From Minnesota, Lori Zuidema reports on the evolution of services at the Wedge Co-op enterprise, Co-op Partners Warehouse. From New Mexico, Robin Seydel provides an in-depth review of the first full year of La Montañita’s Co-op Distribution Center.

(Future reports will explore some of the many other examples of retail co-ops extending support and services to local producers and farmland preservation.)

In the face of constant change, the board of directors too must have the ability to stay focused on mission and policy while also being adaptable. The Policy Governance model, increasingly in use among food cooperatives, offers its own challenges to these governance needs. Heather Schmidt Albinger from Outpost Co-op in Milwaukee offers a follow-up to an earlier exploration and reader discussion in explaining how that board uses strategic initiatives to refine its work of defining expectations for manager performance.

Finally, overall development of food co-op stores has also reached a new era, after many years in which the number of new cooperatives was none or one or two. This year’s co-op awards recognized outstanding contributors to the success of our sector. They also took note of the largest annual crop in memory-at least eleven new stores were launched in the past year! Let’s celebrate the beginning of another new wave of food co-ops, arriving just in time to help cities and regions in the upcoming era of huge opportunities and unprecedented threats to community well-being.

Here are the home towns of our sector’s newbies-co-ops opened since CCMA 2007:

  • Baltimore, Maryland
  • Carbondale, Colorado
  • Missoula, Montana
  • Northampton, Massachusetts
  • Oakland, California
  • Paoli, Indiana
  • Pocatello, Idaho
  • Reno, Nevada
  • Stoughton, Wisconsin
  • Wykoff, Minnesota
  • Yelm, Washington.

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Dave Gutknecht is editor of Cooperative Grocer ([email protected]).

See other articles from this issue: #137 July - August - 2008