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anyone ever set up a Co-Op??

BigAl

Gone But Not Forgotten
SUPER Site Supporter
Our little town in Idaho has a little mid sized grocery store that is slowly going under . Its not from the lack of business but Very Bad management . They have run off a lot of customers .

I'm thinking of setting up a Co Op and starting up a new store so it will be ready when the other one closes the doors for good . I do not want to run it .Thats for someone younger with more energy .

Start up Funds are not the issue as I have committments from quite a few folks who want a piece of the action if I decide to do this .
Anyone set up a CO-OP before ?
 

Erik

SelfBane
Site Supporter
what kind of co-op?
grocery, ag store, gas station?

I've not started a small business myself, but have helped other folks set up theirs a coule of times.
 

Cowboyjg

Country Club Member
Site Supporter
Al,

A few things come to mind. Although, first, here is a link I found interesting and potentially useful.

Why would you and your prospective investors not buy the store outright and form a "Board of Directors" to provide general oversight. Hire your own management and staff and the like. This could allow you to utilize the already established relationships with suppliers and such. It also allows you an established location and a sense of familiarity to the buying public.

To me anyway, at that level, you might be serving the community better. One store is not going to have the buying power of a "Sam's Club" and so the benefit to the member might be minimal. So much so that the exclusionary aspect of not being a member would be counter productive to the ROI needs for the "Investors".

Now I'll admit, I'm not knowledgeable enough of the inner workings of a co-op to know how it really compares but these were things that came to my mind.
 

DaveNay

Klaatu barada nikto
SUPER Site Supporter
Al,

I wonder if IGA has a department that can help you set up your new operation?
 

BigAl

Gone But Not Forgotten
SUPER Site Supporter
Actually the "Great" original owners were tied to the "Family Market" Chain of stores in Idaho . They had a hell of a bussiness . It cost about $100 K per year to be part of the chain and I have looked at it . The present owner of the store is trying to save his ass and has listed the store at 3 times what he bought it for and it now has 1/3 of the amount of items .The new owner dropped out of the "Family Market" program shortly after taking over .The store is now only restocked every two weeks and the guy buys at the bargain discount food store that sells product that are almost outta date . I can't tell you how many times the milk was spoiled

There is no deal in buying the old store . I could build a brand new facility for much less than he is asking . Besides we have a number of buildings that will work well with minor upgrades ,which I can design and arrange to be remodeled .

I'm thinking of setting up a Co-op based on 100 shares of stock . Each share sells for x amount of money . The owner of the share is entitled to a discount off of purchases he makes at the store . The more shares he owns the bigger the discount . He can sell his share or shares to another buyer any time he wishes . OR we can just keep all the prices for everyone the same and pass out dividends checks at the end of the year based on amount of shares owned .

I would need to set up a Board of Directors ,who the Store manager would answer to . I do not want a bunch of Chiefs running around and telling the manager how to do his job .He would answer to the BOD's and no one else . I already have committments from the store employees to come work for us if we go forward with this . All I would need to do is put a manager into place and open the doors .

This is more of a convinence thing than a big money thing for me . We are traveling 54 miles to shop now and with the price of fuel that is not reasonable ,even though we pool our shopping list and one or two people go down to get supplies .

I have the new location already acquired and have offered to sell my shares over time to the new building owner if she should ever decide to take over the total operation. She is a close friend of the family .

I do not take on any partners in Business Deals ,but this seems to be a better approach since I travel alot , am retired, and like my present lifestyle .
 

Doc

Bottoms Up
Staff member
GOLD Site Supporter
I'll toss out another train of thought .... Rather than a co op you might be able to accomplish the same thing with a grocery delivery service. Have the folks order what they want you have have it delivered once or twice a week. A web interface for ordering would make it easy to add to or update orders ....
 

Jim_S

Gone But Not Forgotten
GOLD Site Supporter
I'll toss out another train of thought .... Rather than a co op you might be able to accomplish the same thing with a grocery delivery service. Have the folks order what they want you have have it delivered once or twice a week. A web interface for ordering would make it easy to add to or update orders ....

My Mom lived in a rural area and used Schwans for a lot of her groceries.

Jim
 

BigAl

Gone But Not Forgotten
SUPER Site Supporter
My Mom lived in a rural area and used Schwans for a lot of her groceries.

Jim

They do come to Elk City and many people are now buying from them ,but there is a lot of everyday stuff they don't have .

Weather I do this or someone else does ,it will happen . That store also use to supply the other "little store" in Dixie and all the huntin Outfitters in the area .This guy just drives off business . Its so bad now the local bar in town is selling milk !!! For cryin out loud !!!
 
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