Low-income discounts, for those who are on a public assistance or means-related program, are an increasingly preferred form of discount at the register. For more information on discounts at food co-ops, see the wiki on that topic: http://www.cooperativegrocer.coop/node/2411.
Extended terms for member investment are another increasingly common method by which food co-ops make it easier for low-income shoppers to join as co-op owners.
As an example, Renate Kopynec of Wild Oats described that co-op’s discounts for low-income shoppers:
“We offer a 10% "Healthy Food for All" discount to low-income shoppers. We define low-income shoppers as customers eligible for SNAP benefits (food stamps), WIC, Medicaid, and select state health insurance programs in our tri-state area. We are not interested in looking at peoples' tax returns, so we stick to eligibility to programs that "pre-vet" applicants for us. Customers must re-apply for this program annually. This is open to both members and non-members. Currently the cost of this discount is running .25% as a percent of gross sales.”
Additional retail servicess that help people with reduced income are offered in "Grocery Shopping in a Recession,” an article by Julie Cross from Davis Food Co-op, linked below under Related Content.
An innovative approach to serving more low-income residents and supporting their becoming co-op owners was described by Clem Nilan of City Market Co-op in “Bringing Low-Income Shoppers into the Co-op” (2009); it is linked below under Related Content..
Senior discounts are not necessarily a fit with low-income discounts. Community Mercantile (“The Merc”) in Lawrence, Kansas, managed a transition between the two, as described by front end and customer service manager Zac Hamlin:
"#1. Only Owners (members, member/owners, or your noun of choice) over 62 would receive a daily 5% discount. This had an added effect of helping some folks get off the fence and become a more invested part of the co-op. We had a 2 month "grace period where we informed folks of the change. Early and often.
"#2. We shuffled part of the budget formerly reserved for blanket "senior discount" to a "5% Vision* Discount" *Vision is Kansas' SNAP program -- In order to receive the discount a card holder must notify a cashier that they are a vision card holder, they DO NOT have to be owners. However,
"#3. The Merc has for years offered a scholarship program we call "Mercshare" that provides Ownership Shares to Vision Card Holders. This program is funded by the generosity of owners, staff and once a year we do a fund drive at the register. Scholarship shares are in no way different or inferior to any other share, in fact there is no way (at the employee level) to tell how a person paid, or didn't pay, for their share.
"Are these programs perfect? Probably not, but they have worked well for us. Seniors who depended on the discount to help with the cost of groceries were often Vision Card holders as well, this means they were able to receive a discount, it just had a different name. One of the reasons we felt we needed to make the change was that our demographic research showed that our older shoppers were in fact the most wealthy group we served. The fact that the daily discount was becoming a burden was only part of the calculation."
Zafra Whitcomb of Belfast (Maine) Co-op offered further thoughts (August 2012) on senior discounts and WIC (Women, Infants & Children) program issues:
"We have been gnawing on this question on-and-off for years, affordable food being one of our founding values, as I am sure it is for many co-ops. The Belfast Co-op has a Senior Discount Day on Tuesdays, which provides 5% off for all seniors, and 10% off for senior members. We also have an Equity Assistance Program, funded by contributions from other members, often out of their patronage dividends. We accept SNAP payments, but are unable to participate in WIC as we are unwilling to carry the required mainstream products (for example, Beechnut baby food -- the only baby food in the Maine WIC program) due to the difficulty of maintaining a supply of those products from distributors from whom we would not otherwise order, and the valuable shelf space they would take away from other products more closely matching our purchasing policy.
"Our General Management Team and Board have recognized that many of our seniors are at least as well off as the average population and perhaps our "charitable discount dollars" would be better placed elsewhere. On the other hand, we chose Tuesday for the Senior Discount day years ago because it was generally the slowest day of the week. Now it is one of our busiest. In that sense, it filled a very different purpose in driving Tuesday sales and succeeded quite well. Does the volume increase offset the margin loss? That's always hard to quantify in any promotional program, but it probably has and this one has the added benefit of community goodwill.
"My point is that you may not need to choose between a senior and a need-based discount system. Both programs have both a promotional and charitable advantage, and we may end up doing both. We have also been looking at other ways to keep food affordable - and local - such as the "basics" programs some stores have done."
Amy Fields of Eastside Food Co-op followed up with these comments:
"WIC is a federal program which is administered by each state, so, in effect, there are 50 WIC programs in the US. We chose to get our WIC certification when we opened nine years ago, and our WIC sales, while small, are important to us.
"It is true that we carry some products that we would prefer not to carry, most especially battery cage eggs, and we are looking for a conventional, humane egg to carry. However, we have been able to receive waivers from the Minnesota WIC program for other items. For instance, we have a blanket waiver for infant formula -- we do not need to carry infant formula at all unless a WIC customer asks for it. In the seven years since I've received that waiver, we have never had a WIC customer ask us for infant formula.
"The other waivers we have are: we can substitute organic baby food for conventional baby food; we can substitute organic canned beans for conventional canned beans; and we can substitute our higher-quality shelf-stable soy milk for the ones listed in the WIC purchasing guide. We have to sell these items at the WIC maximum pricing for WIC customers (very low margins).
"We do have to carry conventional cereals because none of the natural/organic cereals we carry have enough iron enrichment to qualify for WIC. We order the cereals by the case from a local grocer in the neighborhood and pick them up one to three times a month. It has turned into a very congenial exchange.
"I don't know if other states offer stores waivers on products that just don't fit their product mix, but Minnesota WIC has been very supportive, and we feel that we are providing a great service to people in our neighborhood who need us."
For additional comments and examples on the topic of serving low-income shoppers, see this separate wiki: http://www.cooperativegrocer.coop/node/2453.