retail news in context, analysis with attitude

Excellent piece in Fortune about food coops, which may not have the traditional business model (they are owned by their customers and aren’t just in it for the money), but often have enviable sales per square foot and shopper loyalty.

“Traditional supermarkets should pay attention,” Fortune writes, “and not just to...stellar financials. Under the coop model, the owner and the consumer are one in the same. ‘A coop has to make money but also has to have the best interest of its owners, who are also its shoppers, at heart,’ says Robynn Shrader, CEO of the National Cooperative Grocer's Association (NCGA).”

The article uses as an example the Park Slope Food Coop (PSFC) in New York, which, it says, “handles so much money that it deposits its cash in the bank every two hours for security reasons. Similar to Trader Joe's or grocer Stew Leonard's, the Food Coop has a limited selection of items (9,500, vs. about 50,000 in a typical supermarket) in a relatively small store footprint (6,000 square feet), which allows it to buy in bulk and produces a high turnover on goods.”

According to the story, “as PSFC notes on its site, it is ‘responsive to the membership rather than to the companies trying to sell their products.’ Because coops don't need shareholders or executives to back initiatives, they answer customer-member demands quickly and are often ahead of national trends. Take grocery bags -- PSFC stopped handing them out (both paper and plastic) altogether two and half years ago.”

And, Fortune continues, “Competing grocery stores could brush aside PSFC as a one-off success story. And although it is true that its scale is rare, consumers are signaling that they want this type of shopping experience ... there are now 200 coops in startup mode, which is the largest number since the 1970s.”
KC's View:
I’ve never been in a coop that I didn’t like. Some of them, like PCC Natural Markets in Seattle, are among the nicest stores I have ever been in. And if I had a coop near me, I’d belong as a member. No question.

Every retailer ought to operate under the premise that the customer is the owner, even if that’s not the actual ownership structure. Because stores are only as good and successful as their customers...and treating them like the boss ought to be a cultural priority.