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Ashland Food Cooperative

Located in the Rogue Valley near California’s border, the Ashland Food Cooperative in Ashland, Ore., is truly an integral part of its community of 23,000 people. Since it was started in 1971, the Co-op has grown to have more than 6,000 customer-owners, is Ashland’s seventh largest employer and is reportedly the first and only Certified Organic Retailer in southern Oregon.

Not content merely to provide good food, the Co-op continues to use the guiding principles it started with in the early 1970s. “We put our staff first, pay a good wage with great benefits and are a socially and environmentally responsible business,” explains businesses.” For example, Hoy says the Co-op, which works with 30 different local farms, has taught new farmers such basics as how to write an invoice. “We’re willing to take time to nurture other business in our community to bring them along with us. We’ve always tried to do the right thing,” she adds.

The History…The Co-op started as a buying club with around a dozen people in 1971. By 1972, it had a small storefront and from there, it’s grown into the fifth-largest (single store) co-op in the nation with 6,400 active owners and $22 million in sales. “Our town has the perfect demographic for a food store—it’s culturally rich with the Oregon Shakespeare festival, Britt music festival, symphony, ballet, opera and Southern Oregon University,” says Hoy. “It’s a little oasis in a rather conservative and rural area and people move to our town for the culture, art, public radio and good food.”

Customer Base…Anyone can shop and anyone can join the Co-op. “Our equity investment is $100,” says Hoy. “Our benefit is a patronage refund based on how much [the customer has] shopped.” Eighty percent of the clientele lives in Ashland. The other 20 percent comes from as far away as Mt. Shasta, Calif., or are tourists staying locally. The Co-op credits its continued growth on return customers. “We survived the recession by pre-planning and becoming efficient… and by joyfully working together to delight our shoppers,” says Hoy. “It’s a lot harder to get a new customer than to keep an old one so we take care of them, make them feel special.”

Client Interaction…The store offers special recipe tastings (such as the New Year’s Eve-themed Black Eyed Annie Hoy, outreach manager. “We serve as a model of what is possible and are there to mentor other Pea Fritters), cooking classes (including a five-class series on improving skills and efficiency in the kitchen for time-starved customers) as well as providing a store blog, newsletters and other outreach via social media.

Number of Products in the Store…15,235

Product Range…The Co-op sells local organic produce, sustainably raised meat and seafood (such as fresh Port Orford Sustainable Fish that is hook and line caught) and bulk foods. The deli offers foods to suit every diet including meat, vegetarian, vegan, wheat-free and raw, with clear signage to ease shopping. Selections include everything from cold-cut sandwiches to vegetarian wraps. The bakery case offers traditional and wheat-free items and the coffee and juice bar serves locally roasted organic coffee and espresso and makes organic freshly squeezed juice.

The specialty department is made up of four main sections: beer & wine, cheese, bakery and mercantile, with its main focus on highlighting specialty products from Oregon that range from premium wines to microbrews to artisan cheeses. Valley View wines, Caldera beers and Rogue Creamery cheeses are just a few examples.

Best-Selling Products…“In terms of dollars, our top-sellers are from the deli’s hot and cold bar,” says Hoy. Best-sellers include Southern fried tofu, lentil and quinoa salad and garlic pasta salad. For the most units sold, organic bananas are number one, followed by Chino Humane Harvest eggs and Emerald Hills (local) grass-fed beef.

Square Feet of Retail Space...11,082

Biggest Challenge…The Co-op’s customer growth has outpaced the size of its most recent location, which was built in 1993 in the center of town. Although the owners have considered opening a second store, research showed that it would only dilute sales. “We’re constrained in our parking for the amount of business we’re doing right now,” explains Hoy. “We have parking lot monitors to encourage people to move along. And we keep putting in registers [there are currently nine]. We bought smaller shopping carts that allow people to pass in the aisle and we upgraded our POS system to get people through faster.”

Number of Employees...150 (20 are part-timers but the rest work at least 32 hours a week).

Biggest Trends…“You’re hearing it across the country, but local is in,” says Hoy. The Co-op recently had 250 people sign up for an eat-local challenge, where customers try to eat only locally produced foods for a week. “Also the message about whole foods and grains being better for you has reached the mainstream audience. We’ve been beating that drum since 1972,” Hoy notes.

Riding the Recession…After years of double-digit growth, the Co-op had a difficult fourth quarter 2008 and first quarter 2009. “Once we could see what was happening, we went on an efficiency campaign around September 2008 to keep costs down. We didn’t hire a lot of new people,” says Hoy. This preemptive approach kept the Co-op in good financial health. By the second quarter of 2009, numbers were up but the Co-op didn’t hire until the third quarter when things were solid.

Environmental Efforts…Ashland Co-op has developed a sustainability initiative that guides everything from building construction to day-to-day practices. For example, it charges for paper bags instead of rewarding customers for bringing them back, and has reduced paper bag usage by 75 percent. “We carry socially responsible and environmentally friendly products. We remodeled in 2000 using Stewardship Council materials. We built an atrium using lumber from a 19th century farm in Oregon. We strove to use a lot of LEED components in the design,” explains Hoy. “We are constantly asking ourselves how to have more efficient lighting, and use less electricity and water.”

Most Interesting Lesson…“Stay true to your authentic voice. Authenticity is something people crave. There are so many issues around food—corporate takeover of natural foods, non-organic versus organic, GMO or not GMO—that we provide a real service to our customers because they can trust us. They know the products we carry are okay for them to eat. We don’t carry trans fats, artificial coloring, flavoring or products with high fructose corn syrup,” says Hoy. “And we hire people who are happy about their jobs and like taking care of customers.”

Expansion Plans…“We have a rainy day fund so we could respond rapidly if a larger space comes up in town to move into,” says Hoy. “There’s a neighboring bank that we covet. Every year we approach and ask if they want to move. We always have an eye to where we might expand.” The Co-op recently purchased a new building next door that it will begin remodeling this year for its outreach and other administrative offices. |SFM|

Deborah Moss has written for CNNMoney.com, Shape, Sports Illustrated and Time Out New York.