Food Cooperatives are businesses owned by the people who they benefit and designed to serve their needs. Our food co-op will be a community-owned, neighborhood grocery store that looks and feels like a traditional grocery store but is democratically governed by its Owners.
Food Co-Ops (or community-owned markets) look a lot like regular grocery stores -- with paid employees, clean spaces, full shelves, and fair prices. But co-ops are different from regular grocery stores in a few ways, too! The biggest difference is in the way the store is owned. Traditional grocery stores can be owned by a corporation, an individual, or a franchise. Sometimes the owner lives in the community, but more often they do not. Grocery stores often belong to distribution networks which have the benefit of keeping cost low, but also have the downside of lack of flexibility and adaptability.
Food Co-Ops are owned by the community members who shop in and support the store. Each Owner has a say, through an equal vote, in how the co-op operates.
The purpose of a co-op it to not to accumulate profit for investors, but to meet the goals of its members. For this reason, profit generated by a co-op is reinvested in the business or the community, or it is returned to the members based on their use of services.
Ownership in the co-op is obtained through the purchase of a share in the business, which does not change in value (in contrast to publicly traded corporations) and entitles the member to one vote in matters that come before the members.
The cost of one share of common stock in the Whitewater Grocery Co. is $150. There are NO ANNUAL FEES. The purchase price for your share is refundable, subject to the terms of our bylaws. Ownership grants the following benefits: creation of a local business dedicated to providing access to full-service grocery store; the right to vote in elections and run for one seat on the board of directors; and financial benefits upon store opening. Financial benefits may include owner specials, case lot discounts on special orders, possible patronage refunds during profitable years, and owner discounts on classes or workshops hosted by the Whitewater Grocery Co. Ownership is subject to terms and conditions set forth in the Bylaws of the Whitewater Grocery Co.
Ownership is a one-time, lifetime deal. You don’t have to re-up yearly as you do with a business like Costco. However, part of our model is based on future fundraising from some owners who feel they can invest more heavily in the store, for example owner loans to the store or buying stock in the store.
No. Owners are not be liable for the debts of the cooperative, beyond the amount invested through your share.
To conduct its business effectively, a cooperative must exist as a legal entity separate from its members. Incorporation is necessary to achieve such status. The Whitewater Grocery Co. incorporated in March 2017. The articles of incorporation as well as our bylaws can be found on our website.
Like other corporations, cooperatives obtain significant advantages from incorporation. The primary one is limited liability. Under incorporation, the personal liability of the individual owners for the co-op’s losses are limited to the amount of equity each member has invested in the co-op.
Each ownership share shall cost $150. This may be paid in one lump sum OR in installments by paying no less than $25 per month toward the full cost. If the Owner has signed the Lifetime Ownership Agreement, and has either paid the lump sum payment, or is current on their monthly payments, they shall be considered a fully paid Owner in good standing.
Opening our store! Your money will help us to pay for legal fees, marketing material, consulting services, permitting costs, equipment purchases, and the many other costs that come with opening a business. Remember that your membership is a contribution to the capital of the co-op. By pooling our money together, we are able to continue the start-up process and continually increase our attractiveness to investors, credit unions, and matching grant programs.
Yeah, like gas to go out of town to buy groceries (no snarky tone)
Right now, we have 550+ owners and we haven’t spent any of that money yet. We’ve been fiscally responsible and our budget is based on the $10,000 grant that we got from the city and the $10,000 grant we got from the USDA. So, right now, that money would come back to you. Let’s say there is the unlikely event that an Aldi’s comes to town and the owners decide that’s adequate for their grocery needs, then we’d pay back the banks whatever we owe them and then distribute the rest to the owners.
The short answer is… because we’ll open the store sooner! Under the Four Cornerstones in Three Stages model that we are using, our community-owned grocery store will not open without 1,000 Owners. This is the level of Ownership that proves we have community support and that we are ready to open.
As we move through the Four Cornerstones in Three Stages model, there are many benchmarks for Ownership numbers that help us know when it’s safe to move on to the next phase. An important part of the feasibility of the market is knowing that we have community support — through Ownership shares!
Also, by becoming an Owner now, you will have early voting rights and be a part of the building process of the community-owned grocery store. Your democratic say will begin earlier and have a huge impact.
I suppose that’s a possibility, however, we’re one of the fastest growing cooperative grocery stores in the country. We’ve been signing up owners at an average of 30 per month for the last year, which shows how many people in town think that having a grocery store in town is a priority. We also have a committee meeting weekly to brainstorm new ways to engage new owners. So at this point, I feel very confident that we have the community support we need. We just need to prove it to the banks by methodically growing our ownership.
Anyone will be able to shop there. Most co-ops have plans in place to help everyone become an owner. People on limited or fixed incomes might - for example - have a percentage of their purchases go toward ownership and then will become an owner as that percentage accrues. Whether or not that’s the approach we choose, there will be a plan to make sure everyone feels invested in their community grocery store.
The benefits of Ownership extend to the individual Owners as well as to the community at large. Most Owners are motivated by a commitment to building up their community through developing a robust local economy. Owners typically enjoy benefits that are not available to non-Owners, such as ongoing discounts and access to special sales or other promotions. Owners also have an opportunity to help in business and operational decisions, including serving on a board to oversee these important aspects of the organization.
By investing in a community market, you are funding an organization that is intended to directly serve its Owners, local producers, and the neighboring community. A community market gives its Owners the ability to directly control or influence decisions made on how the business operates to serve its customers. With a traditional grocery or superstore, the products and services offered are fixed and determined by a controlling interest that is not located within that community. A market owned by the community gives this decision-making power back to the Owners, who are often its most loyal customers, so the offerings are tailored to the specific community it is meant to serve. This is a more democratic and participatory form of running a business.
Whitewater! As far as our address, we’ve got 4 locations pinned down across town. We just received our 2nd market study, which needs to be updated every 1-2 years, and it has a lot of the information we need to update our business plan and site selection. We do know that we need adequate parking, easy access and egress, and something close to or on the main roads that run through town. Our four current sites address these issues.
We know! But we also want to be professional about this and do our due diligence! There are a lot of factors to consider such as traffic patterns, parking spaces, easy of access and egress, and size of the lot. Do we remodel or build new? We’re going through our most recent market study, which helps us figure out how much money we’ll make in each of the locations that we are looking at. The banks expect this of us in order to get funding. And that market study is going to give us a lot of the data we need to make a good decision.
The opening date of the store is based on how smoothly we can move through the three phases of planning and launching the community market. Most community markets take 18 months to 6 years to open. We started this process in the beginning of 2016. For more information about the process, check out our timeline.
The types of items — including decisions about affordability, brand names, local, organic, gmo-free, allergen-free, etc. — will be determined by the Owners of the community market, the Board of Directors, and the General Manager.
Though no decisions have been made yet, there has been discussion about how the community market can best serve the diverse needs of the its customers through several services. Those that have been discussed are:
– grocery delivery
– assisted shopping
– acceptance of WIC and SNAP benefits
– partnering with the Food Pantry
– online ordering
– bilingual signage and classes
– international foods
– meal kits
– cooking classes
There are many dietary, nutritional, and financial needs in the Whitewater community and the community market will aim to address as many of them as possible while still building a store that is viable.
The current core values of the cooperative include a focus on local and Wisconsin-made products, unique foods, and serving the needs of the community.
Our general manager will make those decisions and have regular meetings to talk with local farmers and artisans about selling produce, meat, eggs, and added value products like sauces and mustards. Our mission includes supporting local businesses, and our general manager will be the expert who will coordinate that. Give me your information! We’ve got a survey online that you can fill out online as well so that it gets into our database that we’ll give to our general manager once hired.
Our goal is to serve our community, which means we will have affordable generics and staples such as cereal, rice and potatoes. Remember, this is a community grocer, so if some owners want expensive wine or expensive cheese, we’ll have that too, but it’s not going to be what defines us.
There is no way we can be cheaper than Walmart because we won’t be able to traffic in national bulk and have our own distribution networks the way they do, but we will make sure that we are reasonable and that we put money back into the community in a way that Walmart doesn’t. This is an investment in our community, our profits are shared by owners in Whitewater, not given to stockholders in New York or overseas. And we will always beat big box stores on service.
The grocery business is a hard business with small margins. When there were 6 grocery stores in town, the majority of them were owned and operated by families who were serving the community. Most of those grocers grew older and had kids who didn’t want to take over the business. The stores didn’t shut down because there was no need for food!
The co-op model serves the community in the same way as your neighborhood grocer and doesn’t need to make a large profit to stay in business, and the business model means that we don’t have to worry about owners growing old and kids not wanting to take over. Co-ops are also very nimble in the same way a family grocer is. As community needs and desires change, the co-op knows right away and can make the necessary changes, much like your family grocer could. Franchises like Sentry depend upon their corporate sponsors with 20-year contracts signed with distribution networks; they can’t change their inventory on a dime and this limits the powers of their franchise owners to make important decisions.
Well, first of all, we hope that doesn’t happen! But you can also think of this an easy way to invest in your community and leave a legacy for future Whitewater families.
I'm pretty sure that the big coup here is that Whitewater has announced it has Economic Opportunity Zone (EOZ) investing opportunities. The common council has set aside a chunk of money to try to entice a couple of grocers, but they haven't gotten any bites yet. That chunk of money could go to us. It could go to a new store. It’s a wait and see.