Thinking BIG to Stay Small

The Wedge has over 9,000 active members! That puts us in a very small league of natural food consumer-owned cooperatives in the nation. The biggest is Puget Consumer Cooperative (PCC) in the Seattle area. With 7 stores, they are the largest in the nation with a membership of over 30,000. If we add up the memberships of all the stores in the Twin Cities Natural Food Co-ops (TCNFC), 8 local/regional co-ops, we have over 25,000 members in this area.

This is great news for co-ops and for consumers who depend on them for reliable information and products with integrity. The more members we serve, the more the natural food business stays in the hands of the people who want these foods and products. But the natural food business has grown way beyond the co-ops and little mom-and-pop "health food stores" that fueled the natural food movement.

Brace yourselves: Wal-Mart is now the single biggest purveyor of organic food. Yup. And Costco is in town. And a Super Target is now open, full of groceries. It's the biggest news in the grocery biz - that many consumers prefer to do their shopping in one place, rather than having to make multiple trips. Need summer clothes, a prescription, videotapes and groceries? These stores have 'em all. Conventional grocers are worried about this trend, because the big-box stores can cut incredible pricing deals with food producers, cutting out the middle-man and offering cut-rate prices to consumers. (At first. Until they kill the competition.)

What's this got to do with us? Everything. Natural food co-ops exist in the same marketplace as the conventional grocers. We also have strengths they don't have. Our commitment to customer service, which grows directly from the fact that we answer directly to our members instead of outside investors, has yet to be matched by any conventional grocer or natural food chain store. Our commitment to community, integrity, local production, environmentally responsible alternatives, humane animal treatment - all of these spring from passion, not a sales pitch. That resonates with consumers and people are joining co-ops at a healthy rate.

But co-ops still have to compete with the pricing structure and deal-cutting ability of the big stores. If we don't, eventually even our most committed member-owners will start to look elsewhere for identical products at lower prices.

That's where the headline comes in. Co-ops have to think big to stay small. If the hundreds of natural food cooperatives across the country were to unify the way our TCNFC and the Midwest Cooperative Grocers Association (MCGA) have done, we would form the third largest natural food chain in the country! Co-ops have the ability, under law, to form second-tier co-ops. That's what Co-op Grocers Associations are - co-ops owned by co-ops. The CGAs are able to cut deals with vendors just like the big guys. The CAP program, which went national this winter through the National Co-op Grocers Association, is the first example of this. Our stores can offer you products at significantly reduced prices through this program.

Why don't we do more things like this? We'd like to. There are so many great ideas in the co-op world that could benefit our stores and our members and don't happen for one reason. No capital. Co-ops are notoriously undercapitalized. Every time we want to undertake a trial project it takes months or years of wrangling to get a grant and then years to find the organization willing to give it a try and model it to the rest of the co-op community. This is what happened with CAP - the Co-op Advantage Program that is ballyhooed on signs all over the store every month. Our regional and local CGAs decided to give it a try, invested our own money to start it up, and have succeeded in spreading it to the nation.

But there isn't time for such a slow process any more. Big companies are swallowing the natural products industry at increasing rates, and big retailers are integrating production and distribution into their operations. We have to join together to work like a "virtual chain" to keep our businesses in business. If co-ops don't start thinking big, we won't be able to stay small.