About Consumer Cooperatives, aka a Coop
Consumer cooperatives are a direct challenge to capitalism. We owners do not receive profits from this business model! We contribute a particular amount of money to become an owner—this is our owner equity in the coop business. Currently it is $140 at ONF which can be paid at $20 per year–and we can withdraw the entire amount later, if we choose. If a cooperative pulls in more money than the cost of goods, services received, and employee salaries, all that money is returned to the owners. This returned money or, as our coop calls it, “patronage refunds” is not profit pulled from employees salaries, extracted from suppliers or the result of selling poor quality goods as many of the big-box retailers operate. This patronage refund returns to owners money they spent at the coop during the last year.
At times, the general manager and the board may choose to keep back part of the owner equity to cover planned expenses or unexpected expenses. The board votes each year on what percentage will be returned. Usually 20% is returned and 80% retained to be returned at a later date. Some coops don’t return the retained. However, during general manager Alysen Land’s watch, the funds have been to returned to owners within 7-10 years after they were first retained. This all depends on the financial health of the coop.
About My Coop, Ozark Natural Foods
ONF began as a coop in 1971. I began shopping there in the early 1980s when I first bought land in the area. I became an owner before I even moved to northwest Arkansas. The first place I remember shopping regularly was the cramped house located on Rock Street across from the police station. It was a funky little store with some severe management problems. After a long financial struggle the store recovered. In 1993 ONF moved to a downtown commercial location on Dickson Street. There the store grew, but parking was limited. After the move in 2000 to Evelyn Hills Shopping Center and the financial crises involved that year, the current general manager resigned and Alysen Land was promoted from within to the general manager position.
With the help of a financial consultant and some drastic cuts, the coop struggled to reduce its debt. Within six months the financial picture was improved. ONF, under the leadership of Alysen Land, has gone on to win national awards and now has an excellent credit standing. Recently ONF has purchased the entire building allowing for the possibility of expansion. Current plans project paying off that mortgage by fall of this year! Would you fire a general manager who has accomplished all this? I would not! I would give her a raise!
Firing a Successful General Manager for “No Cause”
On March 22, 2012, the previous board of directors of ONF fired general manager Alysen Land for “no cause” in a four to three vote by the board. We, the owners did not receive any official word of the firing and the employees were warned by the board not to talk about it at the store. Rumors abounded. I was shocked and then outraged the more I looked into the situation. Below is my letter to the board of ONF. This is a board with some new members. I urge you to write your own letter to the board: firstname.lastname@example.org
Dear Board Members,
Ozark Natural Foods is one of the main reasons I live in northwest Arkansas! As a member since the early 1980’s I have watched the many transformations that bring us here today. The board is answerable to the owners—that means we need information about important board actions. As one of the owners, I expect to be allowed to attend any meeting of the board when the board is conducting Coop business. I expect the Coop Newsletter to inform me of important Coop news –like the board decision to fire general manager Alysen Land last March. Keeping vital news of board actions from the membership does not serve the owner’s best interest.
I attended the so-called Owner’s Forum last Saturday and was sorely disappointed in the tone and content of the board response to our owner concerns. Many of us care deeply about the ongoing health of Ozark Natural Foods. We have trusted Alysen Land and her leadership team for the last twelve years. The board gave us no information to make an informed judgment about the wisdom of the board’s action to terminate her contract.
In light of your actions to date, I am doing everything in my power to inform owners and other community members of the current situation at ONF and encourage both owners and shoppers to seek out the truth.
I sincerely hope that the board will reinstate Alysen Land at the May 15 meeting and I encourage you to give her an apology for all the previous board has put her through. Additionally, I believe a well-earned raise is in order! I also hope this board will eliminate the restrictions place on discretionary spending imposed by the previous board. I urge you to hire legal counsel who respects coop principles.
Unannounced and secret board meetings serve to heighten suspicion and mistrust. An open meeting policy would go along way to healing the rift the previous board created.
Best regards, Paula Mariedaughter