Together We Grow Update

By General Manager Matt Stanley

We’re embarking on a truly grassroots effort to build co-op equity so we can make our dream store a reality and keep as much of the financing for the project as local as possible. Now, three weeks into our owner investment campaign Together We Grow we’re almost halfway to raising enough investments to build you a bigger store!

The goal of raising at least $1.5 million in owner investments will support our much-needed expansion. Now, Astoria Co-op Grocery is asking you, if you haven’t yet invested, to step up and bring the campaign the rest of the way home by October 31st. This is a rare opportunity to see your dollars at work growing a local business that brings tremendous benefit to our community.

We’ve revealed the exterior plans for the new store. We are digging into the design of the interior. Visual images make the new store tangible. Picture yourself choosing a parking space out of the 50 available!

Together We Grow is a capital campaign based on the offering of preferred shares to Astoria Co-op owners that are Oregon residents. Preferred shares, although not a term most of us are familiar with, are quite straight forward.

First, each co-op owner invests in their common share with the co-op. Most of us are paying off the $200 common share in $25 increments. This equity has and will continue to be instrumental in growing our business and making all the things that make the co-op special accessible to more and more community members. Common shares are non-interest bearing and have no par value.

The Co-op’s Series A Preferred Shares are an opportunity for co-op owners to invest in our expansion project and earn an annual dividend. Each preferred share has a par value of $100 and the Co-op is issuing (through a registration with the State of Oregon) 25,000 preferred shares.

The minimum investment involves the purchase of 25 shares, or $2,500. These owners will receive an annual dividend of 3%. Owners who purchase 100 or more shares ($10,000 or more) will receive an annual dividend of 4%.

That’s the nuts and bolts of how this works. Co-op owners receive a reasonable return and the co-op strengthens its balance sheet enough to make the project feasible. Our minimum goal to move the project forward is $1.5 million, or the sale of 15,000 shares. But we’ll need your help to make it happen.

Why sell all the shares? Because it means the co-op can rely less on external financing to complete the project. More dollars stay local. More local co-op owners get to shop and benefit from the very thing that they invested in. We don’t get many opportunities to put our money to work right in our very own community. This is your chance. I am investing. Others in my extended family are investing. Many other owners have already committed their investments. Join us in our cooperative effort to expand this community treasure!

Contact me at matt@astoria.coop or on my cell at 503-791-5692. Together we can hit our goal and move forward to growing a bigger and better store together!

New Store Rendering

Here’s a conceptual rendering of our new store at 23rd and Marine Drive in Astoria’s Millpond; a location that’s been secured with a lease which includes construction of a new store. The new building will be about 12,000 square feet; four times the size of the current store. Read more about the site here.

Owner Investment Campaign

Our grassroots effort to make a bigger store a reality has sprouted! Our business, a consumer-owned cooperative, has launched an owner investment campaign called “Together We Grow”, and we’ve already raised $430,000!

Preferred shares are an issuance of stock for Oregon residents who are Co-op owners. The shares are available starting at a minimum investment of $2,500. The Co-op is issuing 25,000 shares each with a value of $100 and is selling them to raise equity for the expansion. The annual dividend is 3% and for those who invest $10,000 or more the dividend is 4%.

The Co-op’s portion of the project to build a new store at 23rd and Marine drive in Astoria, is about $3.8 million with a minimum of $1.5 million coming from owner investments. Co-op General Manager Matt Stanley feels the Co-op can beat its minimum goal of $1.5 million and is aiming to sell as many of the shares as possible, totaling $2.5 million.

“The more folks invest the less the Co-op needs to go to traditional financing, so more dollars stay local,” Stanley said.

The Co-op sources many goods from local producers and looks forward to growing the marketplace for local food. For every dollar that’s spent at the Co-op, 52¢ goes back into the local economy, according to a report by National Co-op Grocers.

“I think of investing in the Co-op as truly investing in our community. You’re investing in me as a farmer and you’re investing in my business too. You’re investing in all these small local food producers. For us, that’s so meaningful,” Teresa Retzlaff of 46 North Farm said.

The Co-op has been in the community for 43 years with a proven track record including double digit growth in the last five years and growing owners, recently reaching 4,000. This success has led to the Co-op needing more space and amenities. The new store will have a much-needed loading dock, more parking, a larger deli, fresh meat/seafood counter, and wider selection of organic and local produce.

Expansion and investment information is available at www.astoria.coop or stopping by the store.

Community Response

We’re getting such a positive response following our big announcement! Securing a location for the new store was a big step. Since then we’ve met with Co-op owners and the people who live near our future site.

On June 8 we hosted a Co-op Conversation at Shively Hall. Co-op General Manager Matt Stanley, along with several members of our Board of Directors, shared information, answered questions, and heard suggestions.

The meeting started off with background on the project. The Co-op’s Board adopted a strategic plan three years ago which includes an expanded store. Through the planning process the Board solicited feedback and heard loud and clear the community’s desire for a bigger store offering more of what our shoppers love. Further research including a market study and consulting with our co-op grocery peers confirmed this concept viable.

The Board set criteria for a new store site. The essential elements included a space in Astoria large enough for an approximate 10,000 square foot store with plenty of space for parking and ease of access. Desires included river views, adjacent to the Riverwalk, pedestrian access, close to Columbia Memorial Hospital, and space to customize a store from the ground up.

Then came two years of searching for a site which included talking to property owners, and thoroughly investigating everything in Astoria that met our criteria. The board narrowed locations down to a handful and visited each place to get a feel for them. Finally, the Co-op signed a lease which includes construction of a new store at 23rd and Marine Drive in the Millpond development at the end of May.

Several questions and ideas came up at our Shively meeting such as who will be responsible for building the store, how big it will be, whether housing could be added above, traffic concerns, and the desire for owners to be involved. The property owner will construct an approximate 11,000 square foot building and will be conducting a traffic study with Oregon Department of Transportation to address any necessary mitigation. Housing is not being considered as there is no interest from the developer due to costs and height limitation in the area. Co-op owners can get involved by staying informed, showing support during the city land use approvals process, and helping with our capital campaign.

On June 17 we met some of our new neighbors at the Millpond homeowner’s annual meeting.

Many residents said they felt really positive about our proposal. Questions and concerns related to aesthetics, landscaping, and delivery-truck times.

Millpond was a former plywood mill that underwent transformation from polluted site to a clean, model community with senior housing, low income housing, townhouses, and single family homes. We believe the commercial property where we will build the new store will fulfill the original intent of this mixed used development and be a tremendous asset to the neighborhood and our entire coastal community.

At this time there are so many variables with planning the store and financing that we can’t say when the new store would open. It is safe to say though that we are working diligently toward this goal every day. Co-op staff members are extremely excited about the additional space, more efficient layout, and break room. It will make it that much easier to serve you even better with more healthy fresh food, local products, and plenty of space to shop, park and dine. Thanks so much to everyone in the community who has asked good questions and weighed-in with positivity. Feel free to get in touch if you have any more questions, concerns and/or ideas.

General Manager Matt Stanley can be reached at (503) 325-0027 or matt@astoria.coop.

Co-op Conversation

You’re invited to a Co-op Conversation with our general Manager Matt Stanley following our big announcement about the location of our future new store at Shively Hall on June 8 at 7 p.m.

“We’re excited to hear from you and answer any questions you might have about the project,” Stanley said.

Stanley says he will not have more specifics than what has already been shared, but for those with ideas or questions, this will be an opportunity to talk. The Co-op has received an outpouring of positive responses since we were able to share news of signing the lease.

It would be great to see you at this meeting, but if you’re not able to attend, please don’t hesitate to contact Matt or find him in the store during your next Co-op shop. Together we grow!

Matt’s contact information: matt@astoria.coop, (503)325-0027

Larger Store Here We Come: New Co-op Location Selected

By Matt Stanley, General Manager

We heard loud and clear that our community wants more space to shop and more parking. So we want you to be the first to know… it is official! Astoria Co-op Grocery has signed a long term lease which includes construction of a new grocery store at Millpond, located at 23rd Street and Marine Drive in Astoria. The plan is to build a larger version of the current store you love, with more fresh produce, meat, cheese, and deli, more parking (50 spaces), and a dedicated indoor/outdoor eating area. Our new space will include approximately 7,500 square feet of retail space (compared to our current 2,100 sq. ft.).

We aim to welcome lots of new shoppers and owners in this new location so that the Co-op can increase its positive impact on our community. Think: more sales of local products, more money to local farmers, more good jobs, and growing the cooperative economy in our region. Envision more of your friends and neighbors joining the Co-op and benefiting from our increase in selection and services. Go Co-op!

Following a strategic planning process which included an outpouring of support  for a new store, the Board and I did some serious due diligence (more than three years of searching) to find a site that would allow us to meet the community’s needs and the logistics needed for a retail grocery site. This wasn’t an easy quest, but our market research confirms that this new location will allow us to offer this increase in selection and services and maintain our financial health long into the future.

This is the former site of the Astoria Plywood Mill (a worker-owned co-op) which closed decades ago and was redeveloped into mixed income housing with a vacant commercial site where we plan to build the store. It is near the Columbia River, Riverwalk, Columbia Memorial Hospital and Astoria Aquatic Center. It is highly visible and easily accessible, with plenty of room for parking.

There will be a long road ahead with land use approvals and financing, and we’re going to need your support. We look forward to keeping our owners and shoppers in the loop as the project progresses and there will be opportunities for you to provide feedback and get involved. Stay tuned for draft drawings of what the new store will look like and the launching of a capital campaign likely in the fall. Please check out our web page for updates on expansion and don’t hesitate to contact me or find me in the store during your next Co-op shop. Together we grow!

Matt’s contact information: matt@astoria.coop, (503)325-0027

You’re invited to a Co-op Conversation with Matt following our big announcement. Bring your questions and concerns to Shively Hall in Astoria June 8 at 7:00 p.m.

Preparing for Success

By Matt Stanley/ General Manager

We’ve been talking about expansion a lot over the last couple years. We received an overwhelmingly positive response from a shopper survey about expansion, created a Strategic Plan built around the idea that we’d expand and increase our impact in the community, and worked with the Board of Directors to design site-selection criteria that met our needs. Since then we’ve been looking for the ideal piece of real estate. The next big step in our progress towards expansion is signing a lease for a location that aligns with the Board-created site selection criteria.

Real estate negotiations don’t make the best news. We want to present our plan to the ownership when they are firm and in our best interests. In the meantime, I thought I’d use this opportunity to share some of the preparedness work we have accomplished or are currently working on. The goal of all this work is to give our new expanded store the best chance of success – and it has enhanced our current operation too!

Organizational Capacity

Last year we looked at an analysis of our current organizational structure and planned for how it will evolve as we continue to grow and eventually open our new store. Our staff size is expected to grow considerably right out of the gate. Think 60-65 staff members compared to our current staff of 25. We now have a clear path toward what our organizational chart will look like, how roles will change, and where new positions will be needed. This provides staff awareness for those interested in further developing their skills and interests as the Co-op grows. We’ve already implemented a new position, Front End Manager, who oversees the cashiers. We hope you experience continued enhancements in customer service when you check out your groceries.

HR Work

We’ve nearly completed a redrafting of our staff manual complete with legal review. It will prepare us to manage and apply our policies fairly to a larger staff. It will also serve as an improved tool for staff to use in order to understand the relationship between themselves and their employer. The plan for the new store calls for a part time HR person. We know this will improve the workplace because it will provide staff with a regular and accessible expert on the co-op’s benefits, policies, and the handling of sensitive situations in way that aligns with our cooperative values.

Financial Management

Last year we voluntarily underwent a financial audit of fiscal years 2014-2015. We had no material weaknesses – meaning from the auditor’s perspective there is no reason to believe that there has been any misstatement of the Co-op’s financial accounting. We are currently completing an audit of 2016. Producing audited statements will give validity to the financial performance of the Co-op as we seek financing for our upcoming project. It also offers us parameters for improving internal controls and ensuring that the Co-op is following Generally Accepted Accounting Principles for grocery retailers.

Staff Development

We have focused and will continue to focus on developing the leadership capacity of our management team. This includes trainings, weekly review and practice of leadership tools and educational material, and more. We regular read leadership themed books as a team and meet for discussion. Our latest read was a book called The Good Jobs Strategy. The book that demonstrates that companies that view their workforce as an asset to be maximized rather than a cost to be minimized have both happier workers and better business results. Of course, at the Co-op we want happy engaged workers because that translates to better service to our owners and shoppers. Better service means more folks support our Co-op and our impact on the community grows.

Competition

We got experience dealing with increased competition after Fred Meyer completed its remodel in 2014.  We planned and minimized the impact from the increase in their offering of natural foods. We added fresh meat to the store, expanded our deli offering, and improved our prices. Now we have our eyes set on how a Walmart may impact the co-op. The Management Team will be preparing a plan for how we’ll maintain our momentum after Walmart opens early next year. Preparing for competition or shifts in the market for natural foods is a skill we’ll want even after we open our new location. We know that our willingness and ability to support local producers sets us apart from stores like Wal-Mart and our capacity to sell more local products will only increase in our new store.

A Strong Investment

All this work in combination with the nitty-gritty details of the expansion project (signing a lease) which we hope to soon share means that when it comes time to invest in the Co-op’s preferred shares, you’ll know we’ve done our homework, planned meticulously, and thereby minimized risk to our owner-investors and shoppers who depend on our store for their diets. It doesn’t hurt that it improves the co-op experience now too! We look forward to sharing more of our plans soon!

Growing Forward

By Matt Stanley/General Manager
Published in the Co-op’s Winter 2017 Newsletter

I recently ran into Sarah, a regular Co-op shopper. She was excited to share with me her recent visit to Lexington Co-op in Buffalo, New York. I was excited to hear this, as Lexington Co-op is a favorite of mine for several reasons, and I haven’t even been there before!

Sarah noticed that they had the same Co+op Deals and many of the same products as our co-op. The store was abuzz with customers and staff. She said the retail area was larger but that it was similarly crammed with great products everywhere she turned.

We know our store and parking lot are getting pretty cramped, especially during peak times. For staff, the back rooms and office are often challenging to keep organized and difficult to navigate. Space is the main reason we are seeking to expand our store in the near future. And our pending expansion and current sales growth is the reason I love Lexington Co-op.

Lexington achieved an expansion in their recent history, and we’ll be seeking to emulate them soon. Their co-op stands as an example of successful, well-planned growth. And it also continually reminds me of the importance of collaboration among cooperatives.

Store frontFor their expansion, the Lexington Co-op issued preferred shares to their owners and raised $2.5 million for their project. We’ve been working with them to plan our own campaign – they’ve shared campaign strategies and materials. So they’ve set a great example and exemplify collaboration.

I know lots of folks are wondering when we’ll launch our own capital campaign.  Lots of pieces have to come together for us to launch the campaign. But trust me, when we do launch the offering (most likely in 2017), Co-op owners will not be able to miss it! We’ll make a pretty big deal out of it, since it will be key to successfully building our own new co-op.

Oh, and the great deals that looked awfully familiar to Sarah? Co+op Deals are the result of a huge collaboration between 151 food co-ops operating over 200 stores across the country. Our small store in Astoria is able to offer competitive pricing (not just Co+op Deals) because we pool resources with other food co-ops! And our collaboration with these fellow cooperators does so much more. My favorite work with the staff of these other stores is the opportunity to learn from each other and develop our careers in the challenging but often rewarding natural foods world.

Finally, if you check out the Lexington Co-op webpage, you’ll see that they are already working on opening a second store! They surely are committed to growing the food cooperative movement! May we do the same in our store’s future!

Generally Speaking

By Matt Stanley/General Manager
Published in the Co-op’s Fall 2016 Newsletter

Over the last year and a half the Co-op Board of Directors has spent considerable time overseeing the continued maturation of the business as we prepare for expansion. We also sought ways to maintain the relevance of our co-op amidst increased competition and continued mainstreaming of organic and local foods.

A primary way we are making the Co-op more accessible and welcoming regards pricing. We’ve joined forces with 150 food co-ops nationwide to bring our community the Co+op Basics program. Co+op Basics include items in an increasing amount of categories at amazing everyday prices. The program has helped us grow sales considerably which in turn allows our store to further leverage our volume. We saw 14% growth in sales during 2015 and over 20% sales growth so far in 2016. Needless to say, more and more community members are turning to the Co-op for their grocery needs!

Additionally, we are connecting the community to our store by way of their financial investment in the Co-op. In October 2015, we ran our Equity Drive with a modest goal of $10,000. Instead, our current and new owners together helped us raise nearly $30,000 in owner equity during the month, and all in $25 increments!

Our planning includes continued use of this unique and powerful way that owners connect with our co-op. In 2017 we hope to be ready to issue preferred shares as a primary way for our Co-op to finance our expansion and relocation. Finally, we continue to develop our staff with a framework based on preparation for operating a significantly larger store.

In early 2016 we received help with an Organizational Assessment in order to ensure we have the skills and systems necessary to make our expansion a success. We continue to send staff to workshops and trainings relevant to their areas of work in order to maintain engagement with their roles in a growing business. It is critical that we continue to grow our sales in the current location in order to maintain momentum as we prepare for expansion.

Thank you for your continued support of your local Co-op!

Planting the Seed

By Matt Stanley/General Manager
Published in the Co-op’s Spring 2016 Newsletter

You’ve heard us talk a lot over the last year and a half about our Co-op’s growth plans. Please be assured that despite a lack of big announcements about the where and when of our new store, lots of work is happening to prepare us for our expansion. Our focus on preparedness will ensure that when we do open the doors to an expanded location we will be successful. In the meantime, our store is growing rapidly in the current location and space is becoming a real challenge, both for shoppers and employees!

A critical step was checked off our to-do list when the owners attending our March Special Meeting at 14 Street Cafe unanimously voted to adopt preferred shares into our Articles of incorporation. We now have a powerful financial tool and new owner benefit at our disposal to raise the necessary equity to build our new store!

So now begins the hard work of preparing an effective capital campaign. By effective, I mean lots of member participation. For the purposes of this article, I want to plant the seed of an idea. What does it mean to invest in a local food co-op? Is it something we might consider as an alternative to traditional investments? What are the compelling reasons to purchase preferred shares?

In a capital campaign, the Co-op will reach out to the owners who use and benefit from the goods and services of the business to invest together to help it grow and thrive. A clear distinction to be made here is that the Co-op is not asking for handouts. Rather than making a donation, we’ll be asking you to invest in dividend-earning preferred shares.

I think the most compelling reason to invest in your Co-op is that it offers an opportunity to make a modest rate of return (3-4%) on something you’ll watch grow right here in your own community. You’ll see new jobs get created, more local products filling up the grocery shelves, and more fellow community members seeking out the Co-op as a way to live healthier lives. Even the strictest socially responsible index funds won’t let us watch our money turn into positive projects in our own community. Furthermore, parts of these portfolios won’t align with our values nearly as much as our food Co-op.

For the Co-op, the money we raise from preferred shares will create the necessary equity to leverage any third-party loans necessary to complete the project. The more capital we raise through preferred shares the less we need to borrow from a bank. The minimum investment in our preferred shares offering as per our recently approved designation rights is $2,500. For most of us, this is not an insignificant amount. We’ll be seeking an average investment of considerably more than that in order to reach our goal.

There are other ways to help us reach our goal of opening a new store if this minimum investment is beyond your household’s means. You can pay off your common share and even invest an extra $100 (for a total of $300), or you can encourage a friend to join the Co-op. Shopping at the Co-op as much as possible is a powerful way to demonstrate your support, too!

Finally, our capital campaign will require a dedicated team of board members, staff, and other volunteers. If you have experience with fundraising and want to lend a hand, please let me know (matt@astoria.coop).

For a detailed look at the approved designation rights, please check our web page. In the meantime, please trust that we are working hard to open an expanded location that will better serve our growing body of owners and staff.