Case Study: Exponential Ownership Growth Through Organizational Alignment

Three Rivers Market
Knoxville, Tenn.
Year founded: 1981; 2005 incorporated as a co-op
Member investment: $200 Fair Share
Number of members: 5,156
Retail square feet: 6,000
Number of employees: 42

As many food co-ops launch October is Co-op Month celebrations, it is important to consider that at the root of many successful membership drives and events is the concept of organizational alignment. When everyone from the board, staff, management and owners are in agreement on the purpose of the co-op, it makes promoting ownership much easier to the broader community. This is one of the take-away lessons that the leadership at Three Rivers Market in Knoxville, Tenn., learned when they began their re-incorporation as a co-op (2005) and expansion and relocation of their store (2009).

Before becoming incorporated as a co-op in the state of Minnesota (Tennessee does not currently have a legal process for co-op incorporation), the co-op’s ownership investment was a hodgepodge of annual fees with a nebulous “lifetime membership.” The board knew it had to change to a framework that better served the co-op to gain more owner investment, but also to be able to potentially give patronage refunds. While the process of changing was legal in origin, it set in motion an entire organizational shift toward becoming a “real” co-op in its business practices. Part of that process was for the board and management to better understand the needs and wants of the co-op’s community. What they learned was that their community wanted a “good” co-op, and they made plans to become one.

The co-op is located in an up-and-coming neighborhood that has experienced varying levels of homelessness and crime. It speaks to the power of cooperation to be a difference-maker in a community as people from all walks of life have come together as owners. Being a welcoming business and providing a necessary service by selling healthful food was always essential, but when the co-op was able to expand and relocate in the neighborhood, it was able to fulfill other important aspects of the co-op’s mission. They built a larger beautiful, cost-efficient green store, with interstate access and parking. “We became a place that people wanted to come to,” said Jacqueline Arthur, Three Rivers’ general manager.

Since then, they’ve experienced an exponential jump in the number of people who own the co-op, going from 1,900 owners in 2009 to over 5,000 currently. Not only did they streamline the process of joining, but the new store and its success confirmed that the expansion was the right thing to do. “We made it easier for people to feel like it was their store,” Arthur said.

Board president Kim Davis believes that the changes the board has instigated to bring the co-op and its members into alignment throughout the last decade have had an impact on the community. “We’re taking advantage of a synergy that’s going in our store’s new location,” Davis said.

The community and city has put resources into streetscaping and helping launch new businesses by providing loans to people and businesses, like the co-op, that want to be part of the neighborhood’s renaissance. “New things are blossoming in Knoxville,” Davis added. She also cited the efforts of mayor Madeline Rogero, who is a Three Rivers Market owner and proponent for cooperatives. (See Rogero speak about co-ops online in the CBLD Library).

Now the co-op is poised to grow again, and is considering a second location in the city, and for Three Rivers Market, the mission is clear. “Not only do we want to bring more value to that area, but we’re thinking outside the box to go beyond being just a grocery store. We want to use the force of our membership to drive positive change in our community.”

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By |September 1st, 2013|Categories: Case Studies, Solutions|Tags: , |

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