THE MACOMB FOOD CO-OP: PAST, PRESENT & FUTURE MFC Owner Meeting April 23, 2015

We’re Glad You’re Here!  Welcome  Past: Where We’ve Been  Present: Where We Are – and Where We Aren’t  Future: Where We’re Going and How We Plan to Get There  Your Questions

Past: Where We’ve Been – 1  Initial Discussions began in winter of 2009  Goal: Opening a Sustainable Retail Co-operative Grocery Store  Benefit Local Consumers  Benefit Local Producers  Benefit the Community and the Planet  Incorporation in May 2011  Food Co-op Initiative Grant  Marketing Analysis – feasible, suggests a sq. ft. store  Financial Analysis – needs further refinement Suggests break-even in year 7, given projected loans  Internal Readiness

Past: Where We’ve Been - 2  Board Creation, Education and Development  Communication: Facebook, Website, Newsletter, Logo  Events: Fundraising and Owner Growth  VISTA Workers  Community Outreach  Macomb Online Market

Present: Where We Are - 1  Macomb Food Co-op  Organization: 4 Committees, 12 Volunteers (6 directors)  Owners: 370  Income: $97,306  Expenses: $33,587  Equity: $62,796  Debt: $0

Present: Where We Are - 2  Macomb Online Market (through 4/15/15)  Organization: 1 VISTA (1.5 until April), Volunteers, 20 Producers (13 active), free rent  Revenues: $41,809  Expenses: $40,193 Cost of Goods Sold: $34,075 Sales Taxes: $468 Selling, General & Administrative: $5650  Operating Profit: $1616  Yet to be recouped of MFC’s Investment of $4173: $2557  Cash Flow over past 12 months: Average Monthly Revenues: $3116 Average Monthly Expenses: $2555 Average Monthly Profit: $561

Present: Where We Aren’t  Historical Development Model – open very small  Run on a shoestring, expand when market warrants  Contemporary Development Model – open larger, more secure  Phase 1 – Organizing: owners Develop core group, shared vision, asses initial feasibility, incorporate  Phase 2 – Feasibility/Planning: owners Determine full market and financial feasibility Grow ownership to , owner equity to ~$ K Secure contingent lease on a building  Phase 3 – Implementation: owners Conduct owner loan campaign, secure bank & other loans OE: ~$120,000 OL: ~$350,000 BL: ~$360,000 O: ~$25,000 Hire staff, beginning with a project manager Site design, construction/rehab, install equipment Open full service store of ~ 3,000-4,000 sq. ft. or larger

The Present, Summary - 1  After 6 years of effort, the Macomb Food Co-op continues to grow at a slow to moderate pace.  Ownership is approaching minimum number needed to conduct an owner loan campaign. Many co-ops wait until they are owners  Owner equity is ~ 50% of what’s projected we need Projections assume large owner and commercial loans that have an uncomfortably long break-even period  Much work is needed to make faster progress Amount of work exceeds what current number of volunteers can accomplish; more are needed  How well does the contemporary model fit our community?

The Present, Summary - 2  The Macomb Online Market has been a success  Over $35,000 into local economy  Producers are expanding, numbers are growing  Is now in black; small operating profit projected  VISTA position ends in August  Free rent from MDTC for an undetermined period  Market operation is beyond the scope of volunteers  Projected operating profit is not adequate to fully fund staffing needs, even with free rent  Board wants to maintain capital for eventual store  Board Visioning Session of February 2015  Reaffirmed basic goals, added “accessible to all income levels” as a core value  Vision for a store consistent with Owner Survey results

Future: Where We’re Going  Continue to operate Macomb Online Market  Create a “mini-store” at current location; will build further awareness of and interest in the co-op  Large selection of bulk organic herbs and spices  Moderate selection of bulk beans & grains, mostly specialty items unavailable in Macomb  Modest selection of specialty ethnic ingredients  Local dairy products  Local “Grab and Go” ready to eat foods  Continue efforts to create a small-medium store  Refine data for financial pro-forma, business plan  Significantly increase number of owners  Update market feasibility analysis if needed

Future: How We’ll Get There  Hire two staff members: market/mini-store operation, future store planning  1 full time (35 hours/week), 1 part time (15 hours/week)  $12/hour = $31,200 for one year  With taxes, insurance, and job creation credit = $34,200  In order to preserve capital, will fund half from capital, half from new funds  Staff the Store! Campaign  If each owner contributes $50, we would raise $18,500  Encourage owners to purchase 1 or more additional shares  Expand volunteer involvement  Specific projects for the mini-store and the long-term  Increase the number of committees

Conclusion  What We Need  Complete your Staff the Store! pledge card  Complete the Expression of Volunteer Interest (on reverse)  Submit in the enclosed envelope  Encourage other owners to do so as well  Your Turn! – Questions and Answers  Working together with continued and expanded involvement, we can make a multi-faceted sustainable cooperative retail grocery store a reality here in Macomb  Thank you so much for your support!