Conscious Choice: Food Co-ops That Work

July 2002

Food Co-ops That Work

Members decide what's bought and sold — and they save money, too.

by Dennis Rodkin

Tucked into a slightly dowdy industrial park in Matteson, about twenty-five miles south of the Loop, the South Suburban Food Cooperative is a wonderland of natural foods.

Over here are three refrigerators filled with cheeses — some organic, some soy-based, some traditional dairy cheese. Over there are gluten-free cookies, dairy-free puddings, and sulphur-free dried fruits. Look in that freezer back there for organic meats, and over on those shelves for organic spices. Looking for the name brands? Health Valley, Westbrae Natural, Kashi, Imagine? They’re all here, too, along with Kiss My Face, Seventh Generation and Tom’s of Maine cruelty-free bath and beauty items.

Now, for someone who lives within reach of one of the larger, sleeker natural foods stores — and by now that pretty much means anybody who lives north or west of the Loop or in Hyde Park — the co-op might seem a little humble. The setting is modest at best, the signage mostly hand-written, and the store lacking in all the come-ons and other hype that have become as ubiquitous as air in larger stores, natural or not.

But for health-conscious people who live in the south suburbs, a region that is perennially overlooked by upscale chains like Whole Foods and Jamba Juice, the 3,750-square-foot South Suburban Food Co-op is like a little bitty Mecca.

On a recent morning, Sunanda Manerikar had come in to get organically grown whole oats and oregano for her husband and herself, and some Garden of Eatin’ organic blue-corn chips for her grandkids. "This is the only place I can get these things down here, and the no-nitrates hot dogs for my grandkids," she said. "I love to get these things, but when you go to get them in the city, they are so much more expensive, I don’t bother."

A lifeline of sorts for healthy-living south suburbanites since 1974, the South Suburban Food Co-op runs on the same basic principle that guides most other cooperative ventures: There’s strength in numbers. All by herself, Manerikar couldn’t expect to leverage a steady supply of the four or five natural-foods items she relies on. But by throwing her lot in with some 280 other local families with similar preferences, she gets what she needs.

South Suburban is one of a small group of food cooperatives around Chicago that have thrived over the long term. There’s also the Sprout Shop, a cooperative "buying club" run out of Sonya and Ed Kugler’s Highland Park garage; it morphed into that form over the years after starting out as a vegetarian restaurant in the late 1960s and later becoming a health-food store. And then there’s the grandparent of all local co-ops, the Hyde Park Cooperative Society, which started out seventy years ago and now operates three full-fledged grocery stores in Hyde Park and Kenwood.

They’re three very different places — the disheveled storefront, the sophisticated chain of stores, and the garage-based buying club — but the three co-ops all provide their members similar benefits. "There’s a feeling that you own part of this, that your opinions count about what should be sold and what shouldn’t," is how Tim Bell, vice-president of the South Suburban Food Co-op’s board describes the key advantage. Via a co-op, Kugler says, people get a chance to "feel that they are heard. You can go into a big store and say,‘I don’t think you should supply anything that’s got GMOs or rBGH,’ and they don’t even have to listen to you say it if they don’t want to. But when you say that to your co-op, they put it to a vote and make the change if everybody agrees." Because of its nature as a member-owned or -driven business, a co-op necessarily looks after its members’ interests, well beyond simply getting them a good price on soy cheese, says Hal Weinstein, a forty-five year member and six-year board member of the Hyde Park Co-op. When larger powers subtly perpetuated racism in the 1960s and 1970s, he recalls, the "very liberal, very activist" membership of the Hyde Park Co-op encouraged its board to get way ahead of the issue and promote "colorblind" policies in recruiting new members and in hiring and promoting staffers, he recalls. "It’s a community organization, and it reflects what its community wants," Weinstein says.

The Hyde Park Co-op is so big, with over 20,000 members (and an uncountable number of other shoppers who don’t buy membership shares), that community interactivity is built right into the day-to-day operation. Every year, the co-op gives about 10 percent of its profits to community groups and community events — in 2001, that was $40,000 all told, according to Cyndi Alsheriti, membership and education director. It goes to literacy programs and food pantries, to help victims of fires and other catastrophes in the neighborhood, and even to provide soap and hoses for soccer teams and scout troops that use the store’s receiving area for Sunday morning car washes. The smaller co-ops can’t act on that scale, of course, but what they lack in heft they make up for in personal payoffs. At the South Suburban Co-op, manager Dorothy Colson estimates that depending on the item, members pay between 15 and 70 percent less than they would in ordinary retail stores. Big-margin items like spices cost as much as 70 percent less at the co-op because they are purchased in bulk and then split into small quantities sold in plastic baggies, instead of costly, tarted-up glass bottles, she explains; while the smaller differential on many boxed natural foods is a result of buying caselots and handing them along at that price, with no markup at all.

A typical bag of chips is marked up 25 to 42 percent, and a bottle of vitamins as much as 400 percent, Sonya Kugler says, but members get either one without any markup at all — assuming that either they’re willing to buy a whole case and stockpile it, or there are enough other members who want the same product so the club can buy a full case and split it up. "It’s not the way to get groceries if you aren’t one to plan ahead," Kugler says. "You kind of have to know what you’re going to use over the next month and where you’ll store it."

In return for good prices, members pay back with some of their time. Although large-scale operations like Hyde Park’s are barred by law from relying on volunteers, the two smaller ones keep prices low in part by having most of the necessary work done by members. At the Kuglers’ house, that might mean meeting the delivery truck to help offload cases and then divvy them up into what each member ordered. In Matteson, volunteers can meet the trucks, too, or they can cut bulk blocks of cheese into smaller portions and bag them, work a pricing gun or cash register, clean the store, or do any of a number of other jobs.

The idea is that as a member, "you trade the time you put in for better prices," Bell says. The requirement at Matteson is two hours a month — hardly a big inconvenience. There are other rewards for working; among them, an enhanced sense of ownership and community. "You’re all together accessing the food system in an alternative way, and it gives you a feeling of being attached to where your food comes from," Kugler says. At both places, members who either can’t or don’t want to work pay something extra to cover the difference. In Highland Park, while working members pay no markup, non-working members pay a 10 percent markup, still a good deal on products that might be marked up over 30 percent in a retail store. In Matteson, members pay an extra $110 a year — or about $4.58 per hour they didn’t work — on top of the regular membership fee of $36. Paying to have somebody else do the work is a little like inserting the middle-man you eliminated by joining a co-op in the first place, but it’s a reality of life. "Everybody’s crazy busy now, so they have to give up the idea of pitching in, and pay for it," says Kugler, who has seen the share of non-working members rise over the years.

Although historians believe organized cooperatives, in which members pool their resources for everyone’s advancement, may have existed in ancient Egypt and Babylon, most of today’s cooperatives look to Rochdale, England, as the birthplace of the modern co-op movement. University of Wisconsin professor Frank Groves described events at Rochdale in a 1979 history of co-ops. In the 1840s, Rochdale was a long-time textile center many of whose workers were being displaced by efficiency advances made by the Industrial Revolution. In 1844, twenty-eight men — weavers, shoemakers, cabinetmakers and others — organized the Rochdale Society of Equitable Pioneers. It operated pretty much the way the South Suburban Food Co-op does now; buying large lots of butter, sugar, flour, oatmeal, and candles, and then selling them in smaller quantities to members from its rented room in a warehouse on Toad Lane. Their co-op lasted over sixty years and grew to include a housing venture that owned over 300 homes.

During its lifespan, Rochdale established some rules that, although they’ve been tinkered with and re-written over the years, still guide many co-ops. Known as the Rochdale Principles, they are as follows: the club operates independently, membership is obtained by buying shares, every member has an equal vote, and workers share in the profits. Here in the Midwest, there’s a strong historical precedent for co-ops, Groves notes. In the ninteenth and twentieth centuries, immigrant Finns working in the mines and forests of upper Michigan, Wisconsin, and Minnesota formed cooperatives to help their own communities thrive. Later, many turned to socialism, and then to communism, even branding some of their products with a red star and a hammer and sickle.

The Hyde Park bunch that started what is now the trio of Co-op markets in 1932 evidently had no such political underpinnings. The group’s official history says that ten or eleven people got together on December 31, 1932, to form a buying club "to fight the effects of the Depression." Members threw in together on case lots, just as Kuglers’ members still do. Less than two years later, the club opened a store at 5635 S. Harper in Hyde Park.

Ever since, the Co-op has been one of the assets that characterize Hyde Park as a place apart. Prized by the diverse university community for reflecting the population with a wide array of international and ethnic products, the co-op "has always been about being here for Hyde Park, doing what Hyde Park needs," says Weinstein. "You don’t get that, you can’t expect it, from a bigger business."

As interest in natural and organic foods has blossomed in the past decade, the Co-op’s offerings have, too, thanks in part to a long tradition of what Weinstein calls "responsiveness." "We have a board that is made up of people who shop here and live here. They hear what the members want," he says. "And if they don’t hear it on their own, any member can show up at a meeting and say we ought to sell this or that."

The same story played out in Matteson. Colson, who has been a member of the group since it was first organized in a rented room in Park Forest in 1974, and the manager since 1975, recalls that the initial idea was just to help people save money by ordering food in bulk. Walter Demler, a retiree, started making the rounds of Park Forest churches and school groups drumming up support for a cooperative buying society, Colson recalls.

"He got thirty families signed up to start it, and at that time they were only going to buy produce," she recalls, "but it wasn’t organic. Most people didn’t even know what‘organic’ was then. It was just a way to get better prices. We’d check at the supermarket and be sure our prices were lower."

It wasn’t until the mid-1980s that members started pushing the co-op’s focus to natural foods, she says, and a decade later that organic produce grabbed their attention. "Now we’re seen as the only place around where you can get this stuff," Bell says. "The co-op has evolved a lot."

So has the Sprout Shop, which Ed Kugler began as a vegetarian restaurant back in the 1960s in Highwood (adjacent to Highland Park and Lake Forest), and which he and wife Sonya have re-visioned several times over the years. For a while it was a health food store in a Highland Park warehouse, now it’s a members-only buying club, and Sonya Kugler hints that somewhere down the line it might go retail again.

It has changed, she says, as the taste for natural foods changed. The twenty-five families it serves now are interested in "alternative access to the food system, no middle-man," she says. "They don’t think you need to be paying the overhead of a huge retail space, first of all, but they’re not just here for the low prices. They believe in a sustainable community, working together to get resources for everyone."

That’s the goal as well at Chicago’s newest co-op, a fledgling project of the Institute for Community Resource Development in Austin on Chicago’s west side. The organization’s president, LaDonna Redmond, explains that in that long-ignored part of town, "we don’t have enough grocery stores because the big chains just don’t care. You end up buying from the small, expensive corner stores. So we started building relationships directly with farmers to obtain as much food as possible less expensively." It grew into a popular farmers’ market for the neighborhood, and now Redmond wants to take it a step further, establishing a co-op staffed and patronized by Austin residents, with direct relationships with farmers who raise organic produce and meats. If she can secure space for the operation, she hopes to open the co-op by fall.

Redmond’s view of the co-op has it benefiting its neighborhood as much as it does farmers to whom it relates. She hopes to see it create much-needed jobs and open views for local residents into viable paths to success in food, farming, retail, and whatever else they can connect to through the co-op. Membership will cost about $20, she says. "People deserve to have a satisfying job experience and to be paid a living wage," Redmond says. "If we can get those things for them and also bring good, healthy organic food into the neighborhood, I’ll be really pleased."

Buying Clubs

Natural foods buying clubs, the smallest co-ops, thrive all over the country—from rural areas where people don’t have any other access to the kind of food products they prefer, to urban places like Chicago.

Why, when we have a broad array of natural foods stores both large and small?

Sonya Kugler, who runs a buying club in Highland Park, less than ten minutes by car from the Whole Foods store in Deerfield, says the two ways to buy "are like apples and oranges. A big 30,000-square-foot retail store is supporting an industry you believe in, sure, and supporting families, but in a non-descript sort of way. You don’t know those people."

The co-op or buying club, on the other hand, "is your chance to create your own community, meet people one-on-one and support the community you create."

On top of that, she says, the price difference is considerable. "At a natural foods store, you pay some markup, no matter what," she says. "In the buying club, you don’t." Savings vary by shopper, but Kugler estimates most of her members save a few hundred dollars a year.

A less political reason: "City traffic can make it inconvenient to get to the natural-foods grocery store," suggests Susan Futrell. She is the director of marketing for Blooming Prairie, an Iowa City-based wholesaler of many natural-foods products. Blooming Prairie also serves buying clubs; Futrell estimates 15 percent of the company’s annual sales are through buying clubs.

Once a club is organized, Blooming Prairie will help you estimate order minimums and delivery schedules, based on your location. A new club pays 5 percent on top of each order until it has paid in the equivalent of its average order. The pay-in is to secure equity in the company, which gets the club voting rights at meetings and a share in the yearly proceeds. The yearly payout is split between cash back to the group and new equity. If a club disbands, members apply to have the equity returned.

Yearly losses are also spread among members; a club could lose equity. But Futrell says that in twenty-eight years of business, Blooming Prairie has never lost money.

The typical size of a buying club is about twenty-five families. Any bigger and it loses that local, democratic feel, Kugler says. But Futrell says the biggest pitfall for a buying club is disorganization. Typically, somebody has to handle a lot of paperwork, taking in members’ orders and transforming them into one order for the wholesaler; and then making sure everything gets to the right person when it comes in. In response, Blooming Prairie over the years has developed a computerized system, supplemented by in-person training sessions, that shrinks the volume of paperwork.

Now the wholesaler invoices individual orders separately, so nobody at the buying club has to handle that loathsome chore. If a prospective member wants to join an existing buying club rather than launching a new one, Blooming Prairie can search its records for one nearby.

For information on starting or joining a Blooming Prairie buying club, e-mail kelly@bpco-op.com or call 319-337-6448 ext. 1157. — Dennis Rodkin

Green City Market Provides Another Option

Since 1999, the Chicago Green City Market’s mission has been to connect local food producers and farmers to area chefs, restaurateurs, food organizations, and the public. This year’s market promises to be bigger and better than ever, with a bevy of vendors, chef demonstrations, and special fundraising events.

Started by Abby Mandel, the Green City Market is Chicago’s premiere farmers’ market, a one-stop outdoor shopping experience. Market vendors offer everything from hormone-free beef and poultry and organic produce to breads, vinegars, artisanal cheeses, honey, and even flowers. In addition to purchasing sustainably-produced food products, visitors to the market can see demonstrations from some of Chicago’s top chefs. The July lineup includes Dana Benigno of chicagocooks .com, Dean Eliacostas of Rivers Restaurant, Gale Gand of Tru, and Frank Mendoza of W Hotel.

The market, a not-for-profit organization, operates on funds from benefits, memberships in the Friends of the Green City Market, and individual contributions. Volunteer chefs, a task force comprised of area culinary organizations, and one paid employee (the market manager, Lynn Peemoeller) make the whole thing run every week.

The Chicago Green City Market is located at the south end of Lincoln Park, 1750 N. Clark Street in Chicago. Hours are from 7:00 am to 1:30 pm every Wednesday through October 30. Call 847-835-2240 for more information. — Molly Birk

A Chicago Co-op on the North Side

The Chicago Communitarian Cooperative (CCC) was formed in 1995 by a group of Chicago north-siders who wanted to purchase natural foods at reasonable prices and didn’t want to shop at major food chains. Today the Chicago Communitarian Cooperative is a membership-based organization that is cooperatively run and controlled by its members. Members place monthly orders of nearly anything that can be found at a natural foods grocery, including natural household products, and health and beauty aids. Members volunteer a few hours a month to make the co-op function. Because of the collective effort, everything is more affordable. A small group of members from the CCC as well as members of another local food co-op have formed a working group and are currently exploring the possibilities of forming a natural foods cooperative storefront. For information on the Chicago Communitarian Cooperative or about the group working on the storefront please call 312-409-3696.

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