A food co-op operates much like a normal grocery store, except that it's owned by its customers, or members, in order to provide them with the best quality service at the best possible price. By paying a membership fee, customers receive food goods at the lowest possible price. A co-op begins with a great idea and ends with a company that provides a great community service.
Instructions
Research
1. Gather a small group of prospective members, who may also be interested in leadership roles in the co-op to research basic information about starting. These leaders should be professionals, dedicated to the project, and willing to work for at least two years in the organization of the co-op. They should demonstrate a combination of expertise and enthusiasm in marketing, research, business, law and finances.
2. Collect information, as a team, in order to determine the need and feasibility of the co-op in the community. Create surveys to determine your community's interest in a food co-op. Explore your options for local and regional food sources and suppliers and question them about their requirements, as some are willing to offer co-ops better prices. Collect information about the cost of renting a retail space, the potential retail market and health codes.
3. Hold a meeting that includes not only your startup group, but the public, in order to further assess whether there is a need and interest in the co-op. A cooperative is a community-based business, so publicize the meeting to potential co-op members and to the local media. Clearly define the goals of the meeting by creating an agenda that can be distributed ahead of time.
Organize
4. Designate a "Planning Committee" which will research potential locations and handle the negotiation process with real estate agents. The "Planning Committee" should also establish relationships and obtain price quotes from food and equipment providers. The most important role of the "Planning Committee" will be the organization and writing of a formal business plan, therefore the committee should be made up of business professionals with experience in business planning.
5. Establish a "Finance Committee" to research funding possibilities, develop financial projections and to solicit loans from members. The "Finance Committee" should also create a membership plan that will outline member investment options and benefits. Plan a variety of investment options for members so that the opportunity for membership in the co-op is accessible to everyone in the community, rich and poor.
6. Elect a "Membership Committee" to prepare the actual membership paperwork, recruit new members, organize newsletters or websites, plan meetings and conduct surveys. The "Membership Committee" should begin to recruit members and secure their written and financial commitment as soon as possible. Hold a variety of member meetings long before opening and distribute written material that describes the co-op to the members and potential members. It is important to remember that the members are also the owners, so listen carefully and consider their advice.
Finalize
7. Look for other forms of necessary funding to finance the co-op's startup process. Initial financing will come from member investment, however the "Finance Committee" should research possible alternatives in case funding falls short. Many local banks, businesses or economic development agencies will help support a startup cooperative. Be sure to have the "Planning Committee" has created a solid business plan before beginning the loan application process.
8. Incorporate your new food co-op, which will make the business an entity separate from the individuals and members involved. This means that your co-op members can help support you, while at the same time protecting themselves from liability for debts or actions of the co-op.
9. Choose your best location option and begin to purchase equipment and product from suppliers established through the "Planning Committee." Hire a general manager who can help to organize the layout of the store and operational details. The general manager should be responsible for the hiring process, handle employees and hours of operation. Allow the general manager to conduct employee interviews and make hiring decisions, as it will be his team.
10. Cut the ribbon at the grand opening of your new food co-op. You have written a strong business plan, recruited members, obtained financial backing, hired a crew and set up the store. You are now ready to begin operation.
