Many small businesses struggle to achieve profitability. The situation is no different for the Macomb Food Co-op.
“We have never been profitable. We are actually losing less money than the year before. But the cushion we had of capital raised when we were first starting off has been exhausted,” said Gordon Rands, Chairperson of the co-op’s board.
“Economic conditions at the co-op are not good. They’re not extremely dire (and) we’re not in danger of shutting down next week or next month. But they’re not good because we don’t have a capital cushion at the moment.”
The co-op’s income statement shows expenses outpaced revenues by a total of $104,051 through the past three years:
- 2015: $38,513 in the red
- 2016: $43,729 in the red
- 2017: $21,808 in the red
Rands said money has been spent on a variety of things including inventory, equipment, and employee salaries (one full-time worker, two part-time workers).
Rands said just a couple small loans are outstanding so the co-op is not carrying much debt. And he said its owners are not necessarily expecting a return on their investment.
“They’re not clamoring for a dividend, that kind of thing. So our owners are extremely patient investors,” he said.
Rands said the co-op is gathering ideas from owners about how it might bring in more revenue and at least break even. He said some owners have suggested cutting expenses while others believe the co-op should expand and perhaps even find a new and larger building for its store.
The board also wants to know how it can encourage more owners to shop at the store, which is located at the corner of Washington and McArthur Streets.
490 people have bought shares in the co-op. Rands said some have moved on so he estimated the active owner base is closer to 425.
He said nearly half have never shopped at the co-op. And just 15 owners account for roughly 25% of the store’s sales. The other owners who shop there account for around 50% of sales and non-owners account for the other 25%.
Rands said state law allows an individual to own no more than 10 shares in a cooperative.
He said the Macomb Food Co-op incorporated in 2011 and began its online market roughly a year later.