Food Cooperatives: The Lone Example

by Luke Jones  on Monday, Apr. 2, 2012 12:00 am  

You'll have to drive to Kansas to find the next closest food cooperative to Ozark Natural Foods of Fayetteville.

In 1971, a group of Fayetteville residents started the company when no one else was offering local or organic groceries. Its very first order was for organic rice, said Jerry Huddleston, the co-op's human resources manager.

Now, the co-op has 92 employees, of which 70 are full time and 22 are part time, a ratio that Huddleston said he was quite proud of. Last year, the store had revenue of $11.6 million. According to Alexa McGriff, the co-op's marketing director, it has 9,300 members, 2,500 of whom joined last year. Each member pays a $20 yearly fee and can stand for election to the board to help control the direction of the business.

"They make decisions on changes to bylaws," McGriff said. "They're really in charge of what happens around here."

Members are also entitled to about 9,000 distinct discounts in the store and have other perks, McGriff said, like getting shares of the store's profit.

"In 2010, we did $680,000 in profit, and $340,000 was paid back to our ownership immediately in cash," Huddleston said. "It's an economic model with direct rewards for using it."

Huddleston said the co-op had always faced the usual challenge of fighting deep discounts available to chain groceries like Wal-Mart Stores Inc. of Bentonville and Harps Food Stores Inc. of Springdale, as well as natural difficulties stemming from unpredictable weather and crop destruction. But Huddleston said the grocery was willing to pay the price for quality products and happy staffers.

"A lot of shoppers who shop with us, they know we're not cutting corners on production," he said. "We're holding ourselves to high standards. We're not pushing the burden of low cost on our employees."



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