Medford Food Co-op operating in the black

Cooperative's been open just 8 months
Heidi Strow stocks the produce shelves at the Medford Food Co-op.Bob Pennell

The fledgling Medford Food Co-op had hopes of reaching the black some time during 2012.

Turns out the eight-month-old cooperative at 945 S. Riverside Ave., passed that threshold much sooner than expected.

A model of efficiency

Energy Trust of Oregon provided a big shot in the arm for the Medford Food Co-op with a $7,680 check stemming from energy-efficient features installed last year.

The check brought the eight-month-old co-op's total to $9,924 in paybacks for the energy-efficient approach used by architect Gary Caperna and Batzer Construction when the building was renovated.

"That $7,700 check was equal to about a day's sales," said General Manager Emile Amarotico. "That was $7,700 at no cost or hours worked."

The co-op's energy savings were calculated at 60,845 kilowatts annually, compared to buildings simply meeting standard building code. According to U.S. EPA figures, that's enough energy to operate more than four households per year. The building's lighting and refrigeration enhancements reduced its carbon dioxide emissions by 35.3 metric tons, EPA estimates.

Cash incentives produced by the lighting system yielded $3,655 and the refurbished refrigeration systems earned $4,025. Another $994 was received through Avista Utilities' energy-efficiency program, tied to use of night curtains to insulate open coolers during non-business hours. Another $1,250 was received from Energy Trust last year for energy-efficiency incentives.

"Just in the last month, we have achieved break-even level, and we are thrilled," said General Manager Emile Amarotico. "In a nutshell, we are getting traction. After five months of development and hands-on movement down the road, we adjusted the carburetor and started hitting our stride."

As with most start-up enterprises, the co-op took baby steps for the first five months, Amarotico said, getting used to its facility, breaking in a new management team and staff, handling the onslaught of new products and learning the computer systems and software used for operations.

"We felt we were doing pretty good with all those moving parts going seven days a week for 12 hours," Amarotico said.

There were no great expectations for January and February, he said. "Those are notoriously slow months in the grocery business."

The co-op, with its 1,800 individual family owners, was just looking for continued momentum, he said.

"What we found was that in January sales were up 15 percent over December, and we thought it was incredible and amazing," he said. "We were delighted."

Then, there was 7 percent growth in February over January, and March sales grew by 6 percent over February.

"It takes time to prime the pump and take the first steps forward," Amarotico said. "We've been frugal and have got a couple hundred thousand (dollars) in the bank we haven't wanted to touch for working capital."

There were doubts, he said, whether the Rogue Valley could support two co-op shops. Even Portland has a modest number of cooperative outlets.

"Our owners do tend to be more from the 04 ZIP code, but we're more convenient to the downtown core and west Medford residents," he said.

The start-up has benefited from commuters who live in Ashland and work in Medford.

"It's just more convenient for them," Amorotico said. "To have two co-ops in our tiny little valley is pretty amazing. Ashland has a 40-year head start, but we're well along on our way.

Medford Food Co-op threw open the doors on Aug. 8 last year with about 1,500 shareholders. Amarotico believes that number will be near 2,000 when the first anniversary arrives. He said about two thirds of co-op shoppers are nonowners.

"That turns out to be a great starting ratio," Amarotico said. "Some folks still want to know if they can shop here if they are not an owner. They are learning what we are about and can catch the bug. But our owners do tend to shop with their baskets higher than nonowners."

With cash in the bank, the co-op's leadership can even begin thinking about developing a 2,000-square-foot annex adjacent to the 5,500-square-foot store, which has 22 employees.

"I don't see anything happening this year," the general manager said. "We're still talking to a couple of folks about developing a coffee shop or deli. The building looks nice from the outside, but it's gutted and needs a complete makeover."

Reach reporter Greg Stiles at 541-776-4463 or email business@mailtribune.com.



Reader Reaction
We reserve the right to remove any content at any time from this Community, including without limitation if it violates the Community Rules. We ask that you report content that you in good faith believe violates the above rules by clicking the Flag link next to the offending comment or fill out this form. New comments are only accepted for two weeks from the date of publication.
COUPON OF THE WEEK