Cooperative Grocers Associations in 2003
Cooperative Grocers Associations: 2003 Reports
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From #106, May-June 2003
Cooperative Grocers Associations in 2003
Regional CGAs and Their Members
B Y None
Click on the name of each regional CGA to go directly to their report.
Northwest CGA: Growing Capacity
Northwest Cooperative Grocers Association (NWCGA) made a leap in 2002. It's a leap we've watched other CGAs make-some of us enviously, some of us with skepticism. But by the end of the year, leap we did-in our own way.
Highlights of 2002
We had two major accomplishments in 2002. The first was launching our own CAP program-we call our version "CAPWEST." At the time of our report last spring, we were about to offer our first month of CAP specials. Through the year, we continued to hone our own systems and develop the credibility with manufacturers needed to make our program successful. The CAPWEST coordinator, Rick Sheller, worked closely with the other regional and national coordinators to bring our consumers better and better deals. By the end of 2002, after just ten months of operation, we were able to set ambitious new goals for the program and begin to expand its scope of operations.
Our second major accomplishment was re-negotiating our joint purchasing contract with our primary supplier, Mountain People's Warehouse/UNFI. Not only did this give us a chance to clarify some of the terms of our core cost of goods contract; it also marked the end of our first three-year contract.
Given our more closely aligned needs and other logistical requirements, the Northwest CGA formed a joint negotiating team with the Pacific CGA. The negotiating team was faced with the very challenging job of trying to balance the needs of many different stores buying out of three different distribution centers covering a very large geographic area. The combined contract continues to recognize each regional group but puts all stores on similar footing and creates the same requirements and systems for all stores. This helps make running the CAP program easier-both through its similar pricing for all stores and in the consistency of the systems we use and the reports we get from UNFI.
And the leap
CAPWEST and the quarterly rebates we are now getting from our UNFI contract provide the NWCGA with a revenue stream-direct, tangible results of our work together. As of 2003, this means that the group can move beyond being 100% dues funded-for the first time since our founding in 1997. Our stores continue to get a major part of the "rebate" from our joint purchasing contract, but a portion of it comes to the NWCGA. In addition, now that CAP is operating, it provides the CGA with some revenue to cover the administrative support (billing, administrative, and oversight services) that the CGA provides.
Besides providing some financial resources to the group, this has allowed the group to engage a shared (with the PCGA) full-time executive director-me. In truth, the NWCGA has been gradually expanding its staffing capacity over the past several years. But this step puts the group in a more analogous situation with other CGAs that have an executive director, and it gives the group the chance to tackle larger projects and work more closely with other CGAs.
Collaboration and leverage
As it has since its founding, the NWCGA meets on a quarterly basis. We continue to anchor our meetings in the daily reality of our member co-ops by doing store audits at each meeting. This year, we have added a new feature to our meetings-focusing on a topic chosen at the previous meeting and spending several hours looking at that topic in depth. Each member brings sample documents or is prepared to illustrate how they handle that topic. So far, we've spent time looking at organizational charts and will be looking more specifically at front end systems in coming meetings. We hope this will help us continue to share good ideas and identify further areas for professional development opportunities.
We have an ambitious list of goals for the year. CAPWEST will be putting out a coupon book in the fall that will help increase visibility of the program and put some great deals in the hands of our members. We hope to sponsor several training sessions for management staff. We'd like to begin doing some joint purchasing of non-core supplies to leverage our group volume for even more savings for stores. Our increased capacity has unleashed all kinds of ideas for new ways that our CGA can deliver benefits to our stores and to our members.
Pacific CGA: Expanding Our Scope
The year 2002 may well have been the one that the Pacific Cooperative Grocers Association (PCGA) moved beyond "new kid on the block" status. Now in its third year of operation, the PCGA has established its own systems so that the association runs smoothly, and we are starting to see direct, tangible results from our work together. Indeed, the PCGA even helped support a smaller CGA-proving that even the new kids have something to contribute.
After two years of getting its own house in order, the PCGA decided that it was ready to take in new members in 2002. Upon letting eligible co-ops know that membership was open, we were inundated with requests-mostly from our colleagues in the Southwest, members of the Southwest CGA. That group's two Arizona members were considering joining the PCGA, while its Colorado and New Mexico members aren't in the PCGA's "territory." Should the PCGA expand its scope to allow these co-ops to join? How would the logistics of covering such a huge area work? What would happen to the Southwest CGA? Some Southwest CGA members wanted to disband that group, but others weren't ready to make that decision. After considering the options, the PCGA decided to offer some staff time for up to six months to help the Southwest co-ops decide how to proceed. The latter group convened in November and after a long day of discussions decided to re-invigorate their association using a new name: the Four Corners Cooperative Grocers Association (4CCGA). (See page 18.) The PCGA's assistance continued through a reorganizing meeting in January-at which time the group established a budget and new dues structure-and a later meeting. Northwest CGA also contributed some financial support for the Four Corners CGA during this phase. Both groups will remain close partners of the Four Corners CGA through CAPWEST.
Working together pays off
The PCGA founded CAPWEST, our version of the Co-op Advantage Program, together with the NWCGA. Getting the program running successfully was itself a significant achievement for the year-but that wasn't enough. Starting in January, CAPWEST agreed to expand its services to the Four Corners CGA. Bringing in six new stores that purchase out of a different distributor (in this case, Tucson Cooperative Warehouse) was a challenge for CAPWEST. Since those stores are just landing their first CAP product in April, it's too early for us to declare that process a success yet. But we're pleased to be able to make this great program available to even more co-op stores and bring the benefits of our 29-store combined buying power into the hands of even more consumer-members.
2002 was also the year that the PCGA re-negotiated its joint purchasing contract with our primary supplier, Mountain People's Warehouse. While five of our stores had just joined in the contract in March 2002, the other three were ending their second three-year contract. As noted in the Northwest CGA report, the two associations joined forces to negotiate a contract as one group. The contract was finalized in mid-December, and stores started seeing the benefits by January 1.
We were also a "magnanimous sponsor" of a regional sustainable agriculture conference, "EcoFarm." For the program, we produced a one-page ad that emphasizes the connection between co-ops and farmers. We hope to use the artwork from this ad for our next grocery bag design. While grocery bags aren't big things, our collaboration allows all members to receive custom-printed bags at a significantly lowered cost while reinforcing a message that promotes shopping in co-ops.
The PCGA now also has a shared (with the NWCGA) full-time executive director. Like the NWCGA, the PCGA also was able to move beyond being 100 percent dues funded, beginning in 2003. This level of resources gives us the chance to consider taking on more activities and projects that can deliver increased benefits to our stores. Our goals are ambitious and diverse, keeping in mind that we're still looking at the low-hanging fruit so often identified for "easy picking." We're excited to be able to contribute to and participate in the growing efforts to coordinate and better leverage the resources of all regional CGAs. It's a system we're pleased to be part of, as the new kids or otherwise.
Building Cooperation into Our Future
For the Southeast Cooperative Grocers Association (SECGA), 2002 was a year of diving into expansion and operational improvement projects at our stores and looking outward to establish stronger inter-regional and national ties. We have worked hard to 'crack the nuts' (whatever they are) that keep each member co-op from the conscious and timely inclusion of the SECGA in their construction of better strategic plans. Through honest and rigorous assessment of ourselves and our stores, we learn to more deliberately utilize the collective experience and expertise of the SECGA to solve problems, save time, and provide valuable assistance in addressing challenges. In this way we further each member's efforts to move forward more nimbly and more lightheartedly.
Collaborative expansion financing
In 2002 and continuing into 2003, we have worked hard to develop a model for collaboration with our member stores that will allow the SECGA to participate in securing a financing package for expansion projects. This collaboration includes a security guaranty, approved by the board of each SECGA store, on a percentage of the value of the inventory in the expansion project. That inventory value is proportionally assigned to each store for re-purchase in the event of closing.
Our mission: "Fearless, exuberant, forward-thinking leadership in the expansion of cooperative commerce."
The expansion project package also includes an agreement between SECGA and each SECGA member:
The SECGA is also asking its members to open checking or savings accounts at the National Cooperative Bank at a time when we are asking NCB to invest in us.
Growing our stores
Expansions, capacity, skills, and strategies:
Weaver Street Market opened their second retail store in Southern Village. Other SECGA stores assisted in their set up.
Life Grocery opened a café in the additional space they acquired.
Good Foods Co-op opened a deli, café and juice/coffee bar in additional space they acquired; the SECGA audited this store in 2002 and provided critical support and strategic input to the manager for use in enhancing this project. Follow-up action was taken at Good Foods, and we noted the importance and value of using the SECGA to review plans as a means to build better projects in our stores.
Tidal Creek Food Co-op expects to complete the relocation of their co-op in May 2003. There has been much collaboration with the SECGA on this project, from planning to implementation.
Management development-focus on sales growth, efficiency, profitability, and skills development:
We reviewed Tidal Creek's plans for relocation, including floor plans, equipment lists, organizational charts, and staff plans.
We solidified the CoCoGAP project and each store set their own productivity goals at our meeting with Bill Gessner. Some stores are working on improving one department's figures, others on more than one department. SECGA discussions have been key to developing effective approaches to achieve measurable improvement within our stores.
A successful CAP (Co-op Advantage Program) launch occurred in March 2002. In May a joint meeting of CAP buyers and general managers was held at the newly opened UNFI warehouse in Atlanta, Georgia; UNFI hosted a lunch, tour and Q & A session. This served to strengthen warehouse relationship with SECGA and our co-ops. We hired a CAP coordinator in September 2002 and held two CAP buyer meetings in 2002.
A produce managers workshop hosted by SECGA included CoCoGAP goal setting with Mel Braverman, along with work on sales growth, merchandising principles, new organic standards, and a produce department reset with Mark Mulcahy.
Building regional and national CGAs
We continue working with NCGA and regional CGAs to intentionally build a national network. We participated in NCGA and CGA executive director meetings; SECGA provided helpful information and aligned with NCGA strategies. Collaboration to a national degree requires us to remain poised to act as momentum is achieved and opportunities arise.
The second annual SECGA/CGANE meeting was held. At last year's joint meeting, we got acquainted with one another and agreed to network more closely. We collaborated and hosted a joint CoCoGAP session, a joint presentation and discussion of the results of the co-op branding study by Robynn Shrader, and a discussion on the future of the Manager on Contract program. And we all had a ton of fun!
Other SECGA organizational development matters: A member application form and process were developed and implemented in 2002, as Ever'man Natural Foods (Pensacola, Florida), New Leaf Market (Tallahassee, Florida) and Roanoke Natural Foods (Virginia) joined our association.
The Policy Governance model is taking hold and freeing up our members to focus on strategic collaboration among our stores. The SECGA board has a policy monitoring schedule and has approved the executive director's work plan for 2003. In addition, we will assess the structure of the SECGA. For the current year, we conducted a member survey in September to clarify regional expectations and critical issues for our stores. We will continue our mission of "Fearless, Exuberant, Forward thinking Leadership in the Expansion of Cooperative Commerce" by focusing on:
- James Watts, Jr. and Peg Nolan
Twin Cities Natural Food Co-ops:
Rapid Change Requires Increased Agility
Year two of the TCNFC (Twin Cities Natural Food Co-ops) three-year plan saw rapid change and increased agility of the organization. Staying focused and on track was challenged at times by unplanned opportunities that presented themselves. Much was accomplished this past year as an association. Every time we agreed to step back and evaluate, we found something new on our plate. Nevertheless, TCNFC focused on its work as a board, having in-depth conversation around our values and commitment to the work we are doing together. As the general managers focused on the outcomes they want from collaboration, the staff of TCNFC made strides in accomplishing our goals.
Managers as directors and members
As an association we increased our capacity through creating a better understanding of the different roles a general manager plays in the association: as a board member and as a member who receives the goods and services. To support this we made internal changes to our work as a group:
Our goal for strengthening core programs and services saw this progress in 2002:
Our core programs continued to run smoothly and profitably. Mix, our bi-monthly member publication, saw increased revenue, allowing us to add content and extra pages without adding costs to our stores. Mix is mailed directly to 30,000 member households six times a year.
Our leadership development training program completed its third round (detailed in CG #102, Sept.-Oct. 2002), with 13 participants graduating. We also had three previous participants promoted to management positions in 2002. Thanks to a grant from MSI Foundation we will be launching the fourth round of this training program in September of 2003.
We added three more product brochures this year, on meats, organics, and cleaning products. We participated in a number of employee health fairs, PR opportunities, and sponsorship of major Twin Cities events.
Our goal of "unified purchasing" moved forward in partnership with CGA Midwest. We exceeded our expectations in this area with the formation and incorporation of Midwest Purchasing Co-op (see report on CGA Midwest).
Other exciting activities for TCNFC in 2002:
48 board members of our stores attended a workshop with Walden Swanson speaking on the industry. We also conducted a general orientation for new board members and a joint vision session for directors.
Board presidents of all the stores meet six times a year.
We updated and revised the Natural Food Training program.
We provided GORP (Good Organic Retail Practices) training for all member stores, in partnership with Barth Anderson of the Wedge.
During the holidays, we enhanced our prepared foods program through joint promotional materials and planning.
We increased our image through sharing promotional materials for membership drives and Co-op Month. TCNFC is pursuing the concept of an equity fund in partnership with Northcountry Cooperative Development Fund. To date we have spent time helping shape a business plan for future co-op development, with the idea of using some of the BP proceeds as seed money to attract venture capital.
TCNFC overall continues to strengthen its foundation as an association while retaining flexibility. The commitment that all members of TCNFC have to collaboration is evident in our ability to respond quickly to the changing environment. Our partnership with CGA Midwest in the formation of Midwest Purchasing Co-op, our response to the sale of Blooming Prairie, and the growth of the association illustrate the vision and commitment of TCNFC members.
Midwest Purchasing Cooperative Serves Two Associations
CGA Midwest and Twin Cities Natural Food Co-ops (TCNFC) each made great progress in 2002. Jointly the two associations made additional progress in the formation of Midwest Purchasing Co-op (MPC). The two associations held a joint planning session in August of 2002 for the first time. The agenda covered approval of the final documents for MPC incorporation and implementation, establishing a joint position on the sale of Blooming Prairie, and laying the foundation for further collaboration. MPC articles, by-laws, membership agreements, patron agreement, management contracts, budgets, staffing, and all other legal documents had been completed by June. This gave both associations an opportunity to work through any issues before making decisions jointly in August.
MPC incorporated in October 2002, with a board made up of three general managers from each of the two associations. All of our shared financial and staffing activities are now legally housed in MPC. This allows TCNFC and CGAMW to share resources at just about all levels of operations, while retaining their unique perspectives as associations.
MPC provides "management services" to the two CGAs through a contract. The contracts specify expectations of performance on the individual CGA's goals. This leaves the control in the hands of each CGA. While purchasing is centralized in MPC, both CGAs are fully informed and participating in the direction of MPC.
The direction of MPC has been established and financed with the pooled resources of the two groups. Because of the Midwest's vision and commitment, we are able to offer our members a wide range of products and services. The profits from the CAP program, since its 1999 beginning, have always been pooled and used for further association development. This foresight on the part of the general managers enabled us to increase staffing capacity to establish our purchasing programs.
Current MPC purchasing programs are:
In 2003 we will be adding linen and textile services and reviewing the next round of joint purchasing possibilities.
In addition, MPC has also been empowered to negotiate the core cost of goods agreement with UNFI. Along with purchasing, our combined resources have allowed us to launch Co-op Share, a consumer prepared foods program that provides a culinary journey through our delis in the Midwest. We also participated in the Living Wage project through joint funding and have sponsored two NCBA "honored cooperator" awards.
CAP continues to be our economic engine to run these programs and services. We are beginning to return very small rebates to our stores. But our groups recognize the power in keeping the larger portion of the funds generated by the association in the association.
CGANE Reaches 10 Years, 22 Retail Members
Change, growth, change, challenge, change, success, change... Sense a pattern? Cooperative Grocers Association of the Northeast (CGANE) experienced a year like no other in 2002. It began the year with its first meeting with another CGA, SECGA, in the winter, started up CAP in the spring, hired a full-time executive director in the summer and ended the year with the merger of its primary supplier, Northeast Cooperatives with UNFI. Oh yeah, we added four co-ops, bringing our membership to 22 by the end of 2002.
Highlights from 2002
- Dave Blackburn
Cooperative Grocers Association of the Northeast
MISSION: To ensure growth, sustainability, and excellence of food co-ops in our region.
VISION: A unified, vibrant cooperative identity and stronger cooperatives understood and used by more and more people
GLOBAL ENDS: CGANE co-ops are an essential and enduring part of their local communities and are active participants in the growth of cooperatives.
CGANE and CGANE co-ops are essential and contributing participants in strong, interdependent national and regional cooperative systems.
Four Corners CGA:
A Southwest Turning Point
A new name, a new attitude, and four new general managers out of six mark a year of change in the Southwest. With the help and direction of Karen Zimbelman, our CGA has been revitalized and is now providing increased support for our members. During the fall of last year, the Pacific Coast CGA and the Northwest CGA graciously donated the expertise and time of their executive director to assist us in our efforts to initiate and maintain a viable and useful association. We have been greatly blessed by their generous contribution and we will be eternally grateful.
At meetings in Tucson and Albuquerque, we developed an initial set of group policies and meeting procedures, and we continue to work on the development of infrastructure to support our goals and activities. The election of new officers, a new member dues structure, and approval of a 2003 workplan established a solid foundation for the future of Four Corners Cooperative Grocers Association (4CCGA).
The CAPWEST oversight committee approved our application to join, and the 4CCGA is now participating in this wonderful program. While the Pacific and Northwest CGAs pull CAP product through Mountain People's Warehouse, the 4CCGA is driving CAP volume through Tucson Cooperative Warehouse. The 4CCGA members support TCW as our regional cooperative wholesaler. We are grateful to the CAPWEST oversight committee, Karen Zimbelman, and Rick Sheller for making this program possible and supporting our desire to use TCW as our supplier for CAP.
Plans for joint purchasing opportunities are on this year's agenda, as well as a regional local production initiative. We have received interest from the new Boulder Co-op regarding 4CCGA membership and will pursue other growth options as they might develop. We are currently operating without an executive director and are looking at how best to proceed in this area within our current budget. We are excited about our progress this past year and look forward to our opportunities and development in 2003.
CGA Midwest: Building Accountability
For the Cooperative Grocers Association Midwest (CGAMW), 2002 was memorable. Highlights of the year included adding two new members, the sale of their cooperative wholesaler Blooming Prairie, launching the Midwest Purchasing Co-op, increasing peer accountability, and expanding the use of CoCoFist tools as a group and within individual stores.
We welcomed Wheatsville Co-op in Austin Texas (the deep Midwest), and Wheatsfield Grocery in Ames, Iowa, to our association. While Texas was not an identified Midwest state (It’s a state of mind.-ed.), we did agree that it could be warmer to have our November meeting in Austin versus Duluth, Minnesota.
The sale of Blooming Prairie to UNFI late last year set into motion a raised awareness of our work as a CGA. The CGA as an organization supported the sale, and we worked hard to influence the outcomes of this sale. We focused in particular on formation of the BP foundation and on implications of the gain on sale and the opportunities this could present. (News of the BP Foundation is scheduled for the next edition.-ed.) Our ability to respond and align around this change implied a unity that we had not tested in the past. CGAMW and the Twin Cities Natural Food Co-ops (TCNFC) were both able to respond to the changing environment and act as one. Our ability to have frank discussion around the sale of the warehouse, the support we provided each other in bringing this issue to the individual store boards, and the joint position statement to the membership of BP all illustrate our progress.
In August, CGAMW and TCNFC shared a two-day retreat, where we finalized the concepts and details of the Midwest Purchasing Co-op. There is a tremendous amount of synergy beginning to form between our two organizations. Joint projects including CoCoFiSt data sharing, three new product brochures, Co-op Share, and Midwest Purchasing Co-op (see page 16) are all outcomes from this improved relationship. I believe that by combining, both groups were able to gain twice the impact of their purchasing volume. We completed the incorporation of MPC ahead of schedule. Midwest member stores participated in the following purchasing opportunities in 2002: Falk paper program, gift card program, merchant card program, and inventory services. A joint website was launched in November as a consumer interface portion of our shared programs.
Earlier in 2002, in partnership with Marilyn Scholl the CGAMW designed a training that would push the group towards strengthening our peer accountability. The outcome of this training and process is significant. We have created an extension of our membership requirements that each general manager must commit to in writing. This stated agreement provides us with objective tools for increasing the expectations of member participation in the CGA. It also provides us with a foundation for expectations defining individual store success. Our goal in 2003 is to tie our work with CoCoFiSt and peer accountability together for group monitoring of the individual stores and the group as a whole.
Our work with CoCoFiSt this year included:
The ability for CGAMW to be flexible and agile while strengthening its core purpose was tested in 2002. The group responded! Our increased focus on peer accountability and CoCoWorks as objective tools to hold each other accountable speaks to the level of what is necessary for successful collaboration. Our shared relationship with the TCNFC stores for leveraging purchasing power through Midwest Purchasing Co-op raises the bar for interdependence. And our flexibility as an organization was illustrated when we needed to respond to the proposed sale of Blooming Prairie.