Case Study: Celebrating the 5th Anniversary: Just Food’s Journey to Success

Case Study: Celebrating the 5th Anniversary: Just Food’s Journey to Success

Columinate | 31-05-2010

jfc-logoJust Food Co-op: Northfield, Minn.
Year incorporated:2002
Year opened: 2004
Number of members at opening (2004):900
Number of members currently (2010): 2,000
Member equity investment: $125 household
Cost of total project: $1 million
Member loans: $372,000
New member equity: $112,500
Financing: $390,000
Number of staff at opening (2004): 28
Number of staff currently (2010): 47
Retail square feet: 4,200

The Just Food Co-op, located in Northfield, Minn., is celebrating its 5th anniversary, and what a milestone it has been for the community of 17,000. Mike Braucher, the owner of Sunshine Harvest Farm, a local meat supplier in nearby Webster, noted that now that it’s been five years, it’s hard to imagine what things were like before Just Food opened. The co-op is indispensible to the community.

For those involved in Just Food as a start-up, it’s those sorts of comments that are really satisfying. Nowadays, Just Food is held up as example of what a successful start-up looks like from inception to opening. The community organized itself and opened a co-op in two years time, and the co-op has done well. “It’s nice to be in that position,” said Melanie Reid, the co-op’s general manager, “and gratifying.” However, that doesn’t mean everything went without a hitch, or that the co-op didn’t experience big challenges. What a lot of people don’t know, except those doing start-ups, is what it takes to start everything from zero.

Before Reid became Just Food’s general manager, she worked as its human resources and front end manager, two positions combined into one job in the start-up. Because of her previous work in a large food co-op in Minneapolis she figured that applying her skills to the start-up operation would be easy.

Not so easy, she soon realized. Apart from the general manager and finance manager, she had hired every single person working in the store at opening. “I don’t think anyone could have imagined the systems and procedures you need to run a grocery store, and how long it takes to get them running smoothly,” Reid said. “It was incredibly difficult. There wasn’t anything here. A blank slate. I was suddenly aware of a million details. To come from a large co-op with these things already in place, I took it for granted. It was a huge eye-opener.”

Reid described training all the cashiers (most of whom were inexperienced and needed educating about cooperatives), setting up the POS system, creating systems for cash handling and other front end procedures, in addition to creating the payroll, evaluation and compliance monitoring systems for the human resources department. If it wasn’t for the support from existing co-ops who helped set up, advise, and share existing systems it would have been nearly impossible. “Anything that got shared with us from another co-op was really useful,” Reid said. That’s why she’s very willing to give help and advice to other start-ups coming along.

In 2009, they posted their first profitable year, and it was a huge milestone for the co-op. Especially after they hit some cash flow problems in year two and had to raise more funds through C shares and aggressively encourage members to shop more. Things are going well now, and membership and sales continue to grow. Just Food is starting to talk about the future, possibly even an expansion. “Three years ago that didn’t even seem possible,” she said about the co-op’s journey from start-up toward established stability.

“We have an insanely dedicated leadership team and they’ve been the driving force behind our success,” Reid said. “They got behind some difficult decisions and made things happen. They are strong believers in our success. It’s been really rewarding.”

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