Article Title: Steady Growth in Sales, Members, Pushes Coop Toward Expansion

Edition: July 2001
Category: General Interest
Author: Sarah Koehl and Jake Brown
Article:

The Hunger Mountain Coop on Stone Cutters Way is bursting at the seams.

On average, almost two new members join per day and in recent years the coop's sales have grown by double digits annually. Over the last two years growth has been 11 percent and 15 percent respectively, and so far this year the coop is posting a 13 percent increase in sales over last year.

In 1996, sales were about $3 million and today they are $7.76 million, according to Dan Casey the coop's community relations manager.

Now the question arises: what about expansion?

A source close to the expansion discussions said the coop is leaning toward building on its current site, probably adding to the back of the building near the loading dock. Leslie Nulty, the coop's general manager stressed nothing is definite yet, but members have expressed that they want to stay on the existing site, instead of branching out with a satellite shop someplace else or moving entirely.

According to Casey, the original architectural plans took into account the need for expansion. "But you won't see construction crews out here for at least the next year," Casey added. Before construction comes focus groups, member meetings, and the permitting process.

The Popularity of Organic Food

The coop has grown steadily since it moved into its new quarters in 1996. Casey said that the coop is operating at a time when organic food is becoming more mainstream.

"People are skeptical of the use of genetically modified organisms, and people are becoming more skeptical of pesticides," he said. He noted that conventional supermarkets are offering organic food today, an indication of a broader public desire for healthy food.

Casey cited a survey recently done by a research firm, the Hartman Group, that showed that 10 years ago 40 percent of the population nationwide had no interest in organic food. Today just 10 percent have no interest.

Competition

The coop is operating in a local marketplace that appears to offer plenty of low-price, general supermarket competition: Shaw's downtown and in Berlin, and the Price Chopper on the Barre-Montpelier Road, and Howard's Friendly Market in Barre.

But is the coop really competing with these stores? It depends, according to consumers.

Mari Fisher of Montpelier has high praise for certain items at the coop, like cheeses and wine. She also buys bulk items at the coop, saying she thinks it's fresher than similar items at other supermarkets. But she does go to Shaw's, she says, for certain frozen products and other "everyday" items she says are too expensive at the coop.

Sarah Severns of Montpelier believes strongly in the cooperative movement. She was a working member at the first one she joined in Michigan, years ago, and later, while pregnant with her first child, worked as a cashier in a Boston coop. "We got an awesome discount. We were poorer than church mice, and the discount meant we ate, and could afford to eat decent, good food."

When Severns came to town she did not immediately join Hunger Mountain. She says it doesn't fit her idea of a coop. This one has gone too far with packaging, both in terms of the sleek new store, and in the merchandise on the shelves. She says she understands it's a complicated marketing issue, but wonders if the coop could have "been a better citizen and recycled existing property."

A combination of higher prices and packaging at the coop, she says, keep her from buying most of her groceries there. But she does buy bulk items, specialty cheeses, and produce.

Their greens are "divine," but she's disappointed that they've decreased the number of bulk items they carry. She feels Hunger Mountain has gotten away from what she believes to be a large part of the mission of coops: providing less packaging, and more "low-end" but decent, healthy products.

David Hale, Executive Chef at New England Culinary Institute (NECI), and a coop member, has a different viewpoint.

"When I returned from California to teach at NECI, I was crushed to see the poor quality and lousy variety in the supermarkets during the winter months. Once I discovered the Coop, I was fired up to shop, to see people, and to participate in such a great place." He says membership is more than a discount. "It's about the people who work there, shop there, and about doing something outside of the context of my professional life."

Hale said he is impressed with the way the council and management have dealt with growth. While he understands not everyone is going to be happy about the way the coop has evolved over time, he believes it has a vital place in the community, and says there is "no question that the larger Coop is a benefit to everyone in the area."

Reasonable Prices?

According to Casey, "there is a perception that we are expensive, but our prices are very reasonable. As far as quality goes, I don't think anyone can touch us."

Despite his claim that coop prices are reasonable, Casey said the coop does not try to compete with other stores on price, other than to note in some ads that the bulk food section offers inexpensive goods.

"Traditionally, we have not said, 'you'll do better coming here -- it's not a point on which we compete; it's not the thrust of our marketing," he said. "We also support local farmers and others, and that's not always the cheapest."

Real cost is a sum of all the things that get that food into your shopping basket, Nulty says. It starts with the producer. Small producers using sustainable practices simply cost more than large-scale mass production. One reason is that there is more loss with organically grown produce, so the salable product becomes more expensive. Nulty says the coop also tries to treat its employees better than other supermarkets. According to state of Vermont figures, Nulty says, coop workers receive higher than average pay and enjoy a generous benefits package. This contributes to a higher prices.

A Transformation

Walk into the Coop's store, located along the river on Stonecutter's Way, and you can tell you've entered more than just a grocery store. You are greeted in the foyer with piles of free alternative publications, and pamphlets printed by the coop to teach about their product, or to assist shoppers with dietary restrictions. These days there are also organic herbs, gardening supplies, and bags of compost.

Today's store is a far cry from what it was like when Ben Scotch worked with other members to "break down" large food shipments into individual member orders during the 1970s. Scotch, the executive director of the Vermont Civil Liberties Union, was a member of the coop when it had no storefront and he remembers meeting at the Unitarian Church periodically when food arrived to get orders ready.

Stressing that he was not denigrating today's coop which he said still provides top-quality, healthful food, Scotch said the new coop is more like the expensive Fresh Fields or Bread & Circus food stores popular in major suburbs.

"While you can certainly get food to live a vegan lifestyle at the coop," he said, in the its earlier form, "we didn't have five kinds of herring from Norway."

"I'm not being judgmental, but for good or bad, maybe inevitably this is the way things go," Scotch said.

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