Are Americans Giving Up on Supermarkets?

Cooperative grocery stores grow faster and have a better impact on local economies than conventional stores.
Roanoke Natural Foods Co-op in Roanoke, VA, reports 45 percent sales growth since 2009, reaching nearly $5 million in sales last year. (Photo provided by RFNC)
Jan 18, 2013· 2 MIN READ
Steve Holt is a regular contributor to TakePart. He writes about food for Edible Boston, Boston Magazine, The Boston Globe, and other publications.

When Laura Toni-Holsinger walks into the Friendly City Food Co-op in Harrisonburg, VA, the sight of bright, beautiful vegetables—much of which are grown nearby—greets her immediately. She first hits up the wall of bulk items to stock up on locally roasted coffee, baking staples, or sweet treats before filling her bags with produce for the week.

She needs a recommendation for a tasty havarti, so she consults the store’s cheese expert, who happens to double as its bookkeeper. She might shoot a wave and a hello to the general manager, Steve Cooke, who’s rushing around quickly, wearing far too many hats. Before she leaves, though, she’ll catch up with the cashier, who gives Toni-Holsinger an update on his college classes.

She is one of a growing number of Americans who are passing over supermarkets—in Toni-Holsinger’s case, four Food Lions, two Walmarts, one Kroger, and one Martins—in favor of a cooperative food store that features healthy, local foods, and where the shoppers double as the owners and staff.

“It’s more than just a grocery store,” says Toni-Holsinger, a nonprofit consultant, new mom, and Friendly City member. “It’s a gathering place, a lunch spot, an economic opportunity, a breath of fresh air among strip malls full of chain retailers.”

In community-owned grocery stores across America, similar scenes play out day after day—and increasingly so. Even in a struggling economy, where many families are forced to spend less on food, new cooperative groceries are opening at a faster clip than researchers can count, and existing co-ops are seeing an average annual sales growth of seven percent. By comparison, conventional supermarkets lose money year over year, evidenced by their drop in 2011 to just over one percent net profit, according to the Food Marketing Institute.

Individual co-ops report big profits and growing enrollment. Seattle’s PCC Natural Markets, the nation’s largest co-op, now has 45,000 members shopping at nine stores, generating more than $100 million annually. The People’s Food Co-Op in Ann Arbor, MI, started in 1971 and has grown to more than 6,500 members and $5.5 million in sales. It’s become a “pillar in the community,” according to food systems anaylst Nicki Sandberg.

The majority of the 10 or so new co-ops that open each year are in smaller communities, like Friendly City, in Harrisonburg. General Manager Steve Cooke says the co-op, in its second full year, is on target for a 25 percent growth in sales from year one. River Valley Market launched in Northampton, MA, in 2008, and has grown to over 5,200 members and sold around $15 million in its fourth year—a sales volume projected to have come in year 10.

These co-ops are not only successfully providing members with great products, but they’re also more effective than conventional supermarkets at improving the local economy, the environment, and the lives of their employees. A study by the National Cooperative Grocers Association, released in August 2012, found that, on average:

  • Co-ops give 13 percent of their income to charity, compared to just four percent donated by conventional stores
  • 20 percent of the products sold in co-ops are locally sourced, compared to just six percent at conventional stores
  • 38 percent of co-ops’ revenue is spent locally, compared to 24 percent in local spending at conventional stores
  • Co-op employees earn more ($14.31 per hour) than conventional store employees ($13.35) when bonuses and profit-sharing are included
  • Co-ops spend 19 percent of their revenue on local wages and benefits, compared to 13 percent at conventional stores
  • Co-ops recycle at a higher rate than conventional stores, waste less food, and have an average Energy Star score that is 32 points higher than conventional stores

Furthermore, the report found that for every $1,000 a shopper spends at their food co-op, $1,604 in economic activity is generated in their local economy—$239 more than if they had spent that same $1,000 at a conventional grocer.

The steady growth at the Cambridge Food Co-op in Cambridge, NY, stems from community members looking upon the healthy store and customers with less skepticism, says manager Nancy Bariluk-Smith. And when the once-skeptical finally come into the grocery to see what all the fuss is about, she says they’re reeled in by the warmth and community.

“People come in for coffee, and we’ll sing them ‘Happy Birthday,’ ” she says with a laugh. “I tell them, ‘You don’t get that down at Cumberland Farms.’ ”

Have you been to a co-op in your community? Find the nearest one here!