FREQUENTLY ASKED QUESTIONS

We’ve had so many great questions about our Co-op, and in particular about the physical store. As we continue on this journey as a community, we are eager to provide as much behind-the-scenes details as we can with you. With this information, you can inform yourself and also answer any of these questions coming your way.

You've reached 1000 member-owners, now what? Isn't that the number you need to open the store?

When a start-up co-op gets to 1000 member-owners, it is a huge accomplishment, and we are thrilled to celebrate this milestone! We follow a national model for co-op development which targets around 1000 members in order to have the backing for doors opening on a store. This is in large part due to the capital we'll need to raise for our store once we have a location and full sense of costs; a portion of this capital will come from members investing further through loans and preferred shares. Each co-op's development is unique and, while we have started each of our next steps from a national model based upon member numbers, we are currently looking at a model that encourages us to have a membership closer to 1400 when we open our doors. This is based upon our financial pro forma which allows us to look at what our costs are going to be for the store size we anticipate having in the desired location, and how we can become a profitable business as soon as possible. Having 1000 members definitely shows us (and financial lenders we'll need investing) that we are highly supported by this community, and more member growth now as well as when our store is open, increases that incredible support. No co-op opens magically when it hits a specific number of members, but the more members there are, the easier it is to get the support needed to have a successful community-grown cooperative business.

Do you have a store site yet?

We have not settled on a store site yet, but rest assured there is important work going on to find an appropriate site. There are necessary specifications for a site to be successful and consequently be here for years to come. Our needs for a site fall into the following crucial areas that we cannot compromise on or we will not have a viable cooperative grocery store:

  • Enough designated parking specifically for our store (36 or more spaces)
  • Enough space for tractor-trailer trucks with 52’ trailers to pull into for deliveries
  • Appropriate square footage necessary for sales (7,800 – 8,600 sq. ft.)
  • A store footprint that accommodates our store needs, more square in shape to
    allow for wide aisles, a cashier area, and a place for clients to sit and enjoy a
    bite to eat among other things.

We combine this list with the need for a location that is near or perhaps right in downtown Cedar Falls, but definitely in a lively shopping area with good visibility and road access. An important thing to keep in mind is that the location needs to meet ALL of these needs, not just one or two or again, we will not be successful. As you read this, know that work is going on to ensure we find an appropriate site that meets all of these needs. If you have a site in mind for us to look into for rent or purchase, please email info@cedarfallsfood.coop.

Who is doing the work to find a store site?

The whole community is involved and affected, since this will be a community-owned business. But more direct work is going on through a team of dedicated volunteers vetting potential sites to find the location that fits the above specifications. A subset of our Operations Committee, this team works with a realtor, analyzes potential sites, and does other crucial work to ensure we find a successful site for our cooperative grocery store.

How can you help? We all should be keeping our eyes and ears open for possible sites. And if you have one or two in mind, let us know. We are doing thorough research but we don’t want to miss any options. Email info@cedarfallsfood.coop.

Why does opening a co-op take so long?

When a large corporation (like a Target) goes about opening a store location, it may take just as much time with this process and finding the right store site before diving in. The public just doesn’t see all of that early work but instead gets wind of the store opening when construction is starting. We incorporated at the end of 2014, and because we are a co-op, all of our organizing, feasibility and planning work has been in the public eye due to the difference of us needing community buy-in and support from the start. In addition, we have the challenge of raising owner equity for our project one person at a time, in small member share amounts of $200 each. Because of the democratic nature of our owner shares, we don’t have the same opportunity to identify a few equity partners that will invest a huge amount of the funding needed to open. We have to do it one small, but equal owner at a time. And that takes time. In addition, co-ops are about community-building that is based upon respect, diversity and inclusion which also takes time to build. We work to find like-minded individuals that share the vision and values of our community and then encourage them to join us. If only a handful of our owners and volunteers engage in this work, it takes longer as we are not at the stage of being able to hire dedicated staff to do this work, so we need to get as many helping hands as we can to accomplish the work in front of us. It’s an easy equation – the more who help out, the sooner we’ll get the work done to have our store. And if every current member-owner gets 1 or 2 other members to join, we’ll be farther along in our development as well. Want to volunteer? Email outreach@cedarfallsfood.coop.

What will the Co-op store be like? Will you sell anything besides produce?

If you haven’t been to a cooperative grocery store, you have missed out. They are bright welcoming spaces celebrating the community by focusing on selling products from local producers and farmers as well as featuring local art, musicians and much more. Our co-op will provide a variety of products from toiletries to canned food to fresh produce, allowing a one-stop-shop experience for our customers. Shoppers will also feel confident that the products on the shelves have been chosen carefully with an eye on sustainability, your health, supporting our local economy and much more. Everyone is welcome, and anyone can shop there, not just member-owners. We encourage you to look up food co-ops on your travels so you can see this business model in action, take a trip to one of our Iowa co-ops in Cedar Rapids, Decorah, Iowa City, Coralville or Ames, and watch this video from our visit to Oneota Food Co-op.

Why invest as a member-owner now when the store isn’t open yet?

Now is the best time to join the Co-op because you are a founding member-owner, one who has invested before the store doors are open. And as a member-owners, you own the store through your member share purchase! Founding member-owners will have an impact on decisions affecting the foundation of our store and will have a voice in determining owner benefits, how our store will be set up, and products offered. We listen to our member-owners and each one has an equal vote in this democratic business. In addition, your investment starts paying off now – with approximately 75 businesses partnering with us providing discounts and other deals to our member-owners ahead of our store opening. Not yet a member? Join today!

How many member-owners do you need to open the Co-op?

Until we have settled on our store site, we do not have a specific number of how many members ideally we need ahead of doors opening. The more we have, the more community investment we have, so we continue to work on growing our membership. Member-owner shares are one piece of the pie in the overall capital it will take to have our store. Other pieces include further member-owner investment through loans and/or preferred shares, bank/lender loans, grants, and donations. All of these pieces make up the whole cost of this endeavor. Our financial pro forma will settle once we have knowledge of the costs of a specific site, but we are anticipating needing 1300 or more member owners to help us achieve our brick and mortar store. Our member growth has been exciting – in April of 2018, we had 760 member-owners and by April of 2019, we had 945 – that’s almost 200 investors in one year!

Why is the name Cedar Falls Food Co-op? Is it just for people living in Cedar Falls?

No. But stay tuned because the Co-op is in the process of changing it's name to better reflect its scope and membership. The story of our current name is that at a community meeting early in our development, we decided upon the Cedar Falls Food Co-op for several reasons. The first was that consultants suggested that we have the location of the store in the title rather than another name that does not give any indication of where the Co-op is. This helps people searching for food co-ops if they see within the title the location. Cedar Valley was suggested, but at the time there was the new Riverloop Co-op in Waterloo, which has since closed. Since co-ops cooperate rather than compete (principle 6), we opted to use the name Cedar Falls Food Co-op to distinguish ourselves from the one in Waterloo. However, just as most Cedar Valley residents patronize businesses across the region, we welcome and encourage membership from anywhere. Waterloo is our second highest city with regard to member numbers followed by the Waverly/Denver corridor. In fact, we have members from across Iowa and several other states.

Will you build, buy, or rent?

We are still working on the overall co-op model and have not yet determined the best solution for us. At this point we are open to all options. When you become a member-owner, you'll have a say in decisions such as this one. Exciting, isn't it!!

Why not just a buying club and start out small?

While we admire (and shop at!) the many established food co-ops in the region that started as buying clubs back in the 1960s and 70s, we believe that start-up method does not align with the needs of today’s consumer. We feel strongly that working towards a full-service grocery store will be the most successful approach. In fact, it has been the way with many of the current co-ops now being established, as is outlined in the article, “Why (Some) New Co-ops Fail,” (Cooperative Grocer, Nov-Dec 2012)

What will the membership structure be?

Membership, or ownership, is the heart of a food co-op. Members OWN the co-op through their equity payments (investing in your community) and active participation in the co-op's democratic governance. Each member has the opportunity to vote in Board of Director elections. Since the board is the body that steers the co-op, members have an active voice in how the board is formed and how the co-op is governed. Members can run for election to the board and may serve on committees. Other member benefits may include a patronage refund during profitable years, discounts on case orders, workshops, and specified items each month, the ability to special order certain items, and equivalent pricing at other area co-ops (which is termed co-op reciprocity).

How are food co-ops funded?

Most food co-ops collect a member equity from each member/owner. This equity payment is an investment in your community and a major part of the capital that helps fund the store's operations and improvements. Many food co-ops also conduct member loan drives to fund a building or expand services. Some co-ops collect annual member fees, although this practice is not as common as it once was. Some grants and loans may be available through government or private organizations, and commercial loans from lenders such as local banks and credit unions have also helped to fund several recent food co-ops. The Cedar Falls Food Co-op will thoroughly research all of these options before determining which ones would be best for our situation.

What about Natural Grocers, Hy-Vee’s Health Market, and other grocery stores? Isn’t that enough for us?

All of these stores have important products and services for our community, and we hope to partner with them in providing healthy, sustainable products to the Cedar Valley. Because of our unique community-owned business model with specific focus on local products that keep the dollars within the community, in a location closer to downtown, our market study along with our membership growth shows that our full-service grocery co-op will be a welcome addition and thrive in the region. Also, with our focus on education programs and community events, we can increase the overall demand for local, healthy, organic, sustainable foods and other grocery products, not only at food stores but also the local restaurants. Lastly, we hope to provide shoppers with an alternative to bigger box stores by having a co-op that has healthy, local, organic options without all the aisles of junk, processed, and unhealthy choices that currently fill most of our grocery stores.

Have we answered your questions? Please reach out to us at info@cedarfallsfood.coop.

Thank you for your continued support!