The need for a new rural community cooperative movement

A shuttered Walmart store in West Virginia, Getty Images photo.

The Guardian has a story, "What happened when Walmart left?," about the impact of Walmart closing its store in McDowell County, West Virginia, not only in terms of jobs but in reduced access to food and other consumer goods. 

From time to time I've written about this issue and the very rare response in some communities to create community owned businesses to replace closed stores.

In terms of economic development planning, this is what I term the difference between "building a local economy" and "economic development planning."  Traditional economic development planning looks to others for solutions, and focuses on recruiting for profit businesses. 

By contrast, building a local economy focuses on building solutions that have greater local economic impact.  In the case of McDowell County, West Virginia, they shouldn't be looking to Walmart for their salvation.

Just last week, the Christian Science Monitor did an update ("A former exec at Trader Joe's grows another kind of grocery store") on the "salvage food store" Daily Table, created by Doug Rauch, former president of Trader Joe's, in Boston, aiming to bring more healthful food options to an under-stored neighborhood in Boston.

The article mentions there are eight "non-profit" food stores in the US, but didn't name them, although I am familiar with Fare & Square in Chester, Pennsylvania. A couple years ago, I came across a story of a for profit supermarket owner helping a low income community create a food store. 

And there is the UpLift Solutions consulting firm division of Brown's Supermarkets, a ShopRite member based in Philadelphia ("Why A Philadelphia Grocery Chain Is Thriving In Food Deserts," NPR). 

UpLift assists supermarket firms in working in urban markets, which are problematic because costs tend to be 30% higher than suburban stores ("Access to Affordable Food is Key for UpLift Solutions," AARP).

The CSM story didn't mention cooperative grocery stores, which are another category of community retail. The University of Nebraska agriculture extension program has a unit focused on helping communities create retail cooperatives.

When I read these kinds of stories, I keep wondering why there isn't a systematic response in the US to provide more focused rural retail economic development assistance--although I first thought about this in terms of under-stored low income urban communities--comparable to that of the UK's Plunkett Foundation.

The Plunkett Foundation is focused on quality of life in rural communities and because of the shrinking population in many rural areas, they have a number of programs promoting co-operatives, community shops, community pubs, and other enterprises.

--  Community Shops, Plunkett Foundation
--  Community Pubs, Plunkett Foundation
--  Community Food Enterprises, Plunkett Foundation
--  Publications, Plunkett Foundation

At the same time, I think community owned retail might be an option for impoverished urban areas, or some kind of hybrid social-public-private ownership scheme, because these areas have the same problems that rural areas have in terms of reduced economic circumstances making their areas unattractive to traditional retailers and restaurants.

I'm not saying it would be easy to do.  Urban stores have real problems in terms of attracting quality staff and have big problems with what is called "shrinkage" or stolen goods--not just by "patrons" but also employees.

But it's a way to offer retail coverage that might not otherwise be obtainable.  Combining public sector elements, like a community health clinic with a pharmacy, or a WIC/food stamps center and community kitchen with a supermarket, might be a way to pull it off.

But social entrepreneurialism on the part of nonprofits is rare, although it does exist, from the retail operations of Goodwill and Salvation Army, to a few nonprofit restaurants and the retail activities of NYC's Housing Works organization.

Similarly, restaurants could be run by food service training programs as part of high school and community college vocational programs.  Etc.

The Plunkett Foundation offers a membership program for such shops, which includes bulk buying schemes and technical assistance.

Food cooperatives have the advantage of being able to lean on the resources of the National Cooperative Grocers Association and the National Cooperative Bank.  But without strong support systems, food co-ops have a tough time in low income areas, since they are funded by capital from members.

Nonprofit supermarkets.  In Chester, Pennsylvania, a nonprofit supermarket called Fare & Square was launched by the Philadelphia area food bank Philabundance, and has been open for more than four years ("Nation's First Non-Profit Supermarket Is Picking Up Steam,"Next City; "Q&A: Fare & Square, an oasis in a U.S. food desert," FreshFruit Portal).


Unlike the fairly grim stores that are typical of PriceRite and Sav-A-Lot and other firms focusing on low income consumers, the interiors of the Fare & Square store are attractive, and the organization has strong branding and identity systems.

I believe it would make sense for other cities to work with Philabundance and create a platform out of this store that could be opened in other locations, a kind of franchise for social entrepreneurialism in the grocery sector.

According to the CSM article, cities like Providence, Rhode Island and the Bronx borough of New York City are clamoring for Doug Rauch to open Daily Table stores there.  But there are other options, as the Fare & Square and cooperative grocery models demonstrate.

Soft goods.  Selling other goods is tougher.  There aren't many models I don't think in the US, but working collectively, I don't see why such a model couldn't be created, comparable to Fare & Square.