Case Study: Exciting “Restart” of Spiral Natural Foods

Spiral-exteriorSpiral Natural Foods
Hastings, Minn.
Founded: 1978
Number of members: 550
Retail square feet:1,800
Equity investment:$100
Employees: 9

There are startups, and then there are “restarts,” that in a lot of ways look like startups. A restart becomes necessary when a co-op is languishing in its community and not reaching its potential. The restart often involves the same kind of commitment to community organizing and renewal that characterizes the startup effort, including a strong will to see things through.

Spiral Natural Foods has experienced a restart that is as jolting and exhilarating as a defibrillator to the heart. In one years’ time, the co-op has moved to a new location, raised $200,000 in member capital, hired a new general manager and doubled its sales. Before the restart, the co-op was on life support and on the verge of closing its doors.

The co-op’s sales and interest in the general community had been dwindling over the years, and in 2010 hit a major crisis point. Sales were barely there, management was virtually nonexistent, the co-op had fewer than 200 members, and the board was down to three people. Oh, and their landlord told them that when their lease was up, they were out. The outlook for Spiral was more than dismal. It seemed like nobody cared. Would apathy finally kill it?

However, people did care, and much more passionately than anyone had ever expected. The co-op simply needed leadership. It needed a board to be proactive about its future, a manager to make good operational decisions, and members to reinvest in it. A tall order to be sure, it needed improvement with a capital “I.” It also needed someone to believe in its potential. All the years of marginality had put doubt in everyone’s mind. Bill Gessner (2012 inductee into the Cooperative Hall of Fame) was one of the first people to respond to their call for assistance. He encouraged them to organize on behalf of the co-op in the community. When people were asked by the co-op’s leadership to recommit to supporting their food co-op, the response was overwhelmingly positive.

Baard Webster was hired as the general manager in 2011, and the co-op moved into their new location in September that year. “It’s been a lot like building an airplane while flying, but it’s also been amazing,” he said about the turnaround.

In addition to working with Gessner, the co-op has been working with operations consultant Jeanie Wells, as well as food co-ops in the area. The Wedge Co-op offered financial assistance, Seward Co-op Grocery & Deli co-signed a $35,000 loan, and Mississippi Market, River Market and Valley Natural Foods have shared operational expertise. Tami Bauers helped build member capital. “Everybody’s been so helpful,” Webster said. Still, things were rocky for months after the move.

So the staff worked on improving critical departments, like produce, and things started to turn around. Additionally, the co-op staff got proactive about getting people to join the co-op. “We talk to people that it’s a good thing, that we’re creating employment in our community and buying local, assuring them that the co-op is heading in the right direction,” Webster said. Now, Webster said, positive outcomes are beginning to have a life of their own in the community. “Things didn’t change overnight, but we are getting more confident and people are responding to that.”

Wells, who has been doing operational assessments for Spiral said, “They are destined for greatness. It’s phenomenal what they’ve been through, what they’re doing and what they’re accomplishing.”

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By |July 31st, 2012|Categories: Case Studies, Solutions|

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