Facing volunteer shortage, slow sales growth, Marsh River Co-op puts out plea for help

By Ben Holbrook | Oct 27, 2016
Photo by: Ben Holbrook Marsh River Co-op in Brooks is looking for answers at its annual meeting, board elections and potluck supper Sunday, Nov. 13, from 4 to 6:15 p.m. For more information, visit marshrivercoop.org.

Brooks — Marsh River Co-operative, which opened two years ago, is looking for more volunteers to help staff its store as profits remain elusive.

The fledgling nonprofit officially opened its doors in August 2014 at 5 Veterans Highway. Kim Jacobs, board president, said founding members saw the Co-op both as a means to strengthen Brooks' local economy, and as a community hub.

This year, as the Co-op celebrates its second birthday, the business is grappling with consecutive years of financial losses.

As of June 30, the Co-op ended its fiscal year with a net loss of $600. That loss was significantly greater but was defrayed, in part, through donations and membership income, according to the nonprofit's 2015-2016 annual report.

In 2015, the Co-op reported a profit of $37; however, that figure was incorrect because of an inventory entry error. Instead, that year, the nonprofit lost about $1,500, the annual report states.

Not all of the news is bad, though. While not yet profitable, the Co-op has seen some growth in its sales and membership. The business increased from 81 members to 100 members, and grew its sales about 2.5 percent.

In addition, the business increased the money it paid to local vendors from $46,000 in 2015 to $51,000 in 2016. It also expanded its inventory to include beer and wine.

While those are positive developments, there are still significant challenges that could determine whether the doors remain open another year; namely, there aren't enough volunteers to staff the store adequately, and sales so far are not covering operating costs.

Matthew McKillop, assistant manager, said the Co-op has typically served as a "fill-in" stop for customers looking to grab a loaf of bread or other item that they run out of during the course of the week after they've completed the bulk of their shopping at a different store.

Some of that McKillop attributes to the fact the Co-op is a bit off the beaten path, but also to a perception among some that the Co-op's inventory is too expensive. The issue is more nuanced than that, though. McKillop said that while some items are more expensive — particularly locally produced and organic goods — there isn't a "huge markup" on the inventory.

In fact, McKillop said he frequently checks stores around the area to see how Marsh River Co-op prices stack up.

"I think there are a number of products we can be very competitive on," he said.

As for the labor issue, when the Co-op was founded, organizers envisioned volunteers operating and managing the store, but "It just hasn't worked out that way," Jacobs said.

The reality is that the store is staffed by a limited number of volunteers, which forced the Co-op to hire an assistant manager, a paid 25-hours-a-week position, and a cashier for six hours per week.

If more volunteers were able to staff the store, the Co-op could potentially be open more hours and increase its sales, Jacobs said. With more sales, the Co-op could hire for more positions and, in turn, not have to rely so heavily on volunteer labor.

As it now stands, there about 25 volunteers who keep the Co-op running. However, a 15-member core group does the bulk of the work and those volunteers are unable to contribute more hours.

“This paid time in no way covers all of our needs,” the annual report states. “The Co-op continues to rely on a very small number of volunteers to staff the store and manage the organization. These volunteers cannot continue to put in the number of hours needed to keep the store open and to ensure the Co-op fulfills its mission.”

Further complicating the issue is the fact that winter is quickly approaching — a notoriously slow period and one that is expected to result in losses for the business. To remain sustainable in the short-term, the Co-op must significantly increase sales — to the tune of about $32,000 more than it did this year — and double the current number of active volunteers.

The Co-op has benefited from an unexpected uptick in business in recent weeks, which McKillop said could be a result of more people being in the area to view the fall foliage. He said business also spiked during the annual Common Ground Fair in Unity.

The Co-op is also considering finding ways to raise money through other means, such as applying for grants, and looking at more ways to increase profits while reducing costs. Unfortunately, the Co-op's largest expenses are ones over which the business has little to no control, such as cost of goods, wages, utilities and insurance.

But the situation is not always clear-cut. Potential savings in electricity, for example, would require the Co-op to purchase a a more energy-efficient cooler at a cost of at least $8,000.

The Co-op does benefit from an arrangement with its landlord in which the business does not pay any rent at present. Under terms of its lease, the Co-op will pay rent only if it makes a profit. In that case, rent would be equal to one-third of profits up to a maximum of $1,000 per month.

That arrangement is made possible thanks to Izzy McKay, a founding member of the Co-op, who purchased the building the store occupies, Jacobs said.

If it is unsuccessful in its efforts, the annual reports states there are effectively two options: change the nonprofit's model of operation or close its doors.

“We are looking to you, all member owners, to provide clear guidance to the incoming board of directors about how to proceed over the next few months,” the report states. “This is a critical discussion, and one that the board does not take lightly.”

McKillop said that if the Co-op could address either the labor shortage or the sales issue, then the other problem probably would be resolved as well.

Anyone interested in volunteering in the store or on a committee can contact Becky Weaver at 322-7121 or at mrebeccaweaver@gmail.com. The Co-op also has positions open on its board. Nominations for the annual meeting are due by Nov. 4. Jacobs said she is hopeful the board will boast a full complement of members following the annual meeting.

"We're really dedicated to this and we've made a lot of progress," Jacobs said. "We're set up in quite a good way. We have a lot going for us."

 

Comments (0)
If you wish to comment, please login.