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Oklahoma Food Cooperative Update

  • Subject: [cg] Oklahoma Food Cooperative Update
  • From: JSBMH2@aol.com
  • Date: Fri, 30 Apr 2004 00:53:40 EDT

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From:  "Robert Waldrop" <rmwj@s...>
Date:  Thu Apr 29, 2004  8:09 am
Subject:  Accomplishments and challenges

Below is something I wrote earlier this week, to account for our accomplishments
and challenges. rmw


Determined that opening a retail store was not feasible for a group our size.

Decided to go forward with developing a retail delivery system/buying club local
food model, even though there was no model to follow. Determined the core values
that we wanted to animate our work and enterprise.

Decided to go with a cooperative model of business organization, and to unite
customers and producers in the same cooperative organization. This works because
the cooperative does not get involved with the pricing decisions for products.
Producers set their own prices and receive 100% of the purchase price. The
cooperative's expenses are to be met with a cooperative charge on the customer's
invoice. This is presently a flat fee, with surcharges for transportation
outside of OKC, but this is likely to evolve into a percent of the customer
order as we develop more of a history and get a better handle on the monthly
operating costs.

Developed a way to receive, categorize, revise, and retrieve information
regarding products and their prices.

Deployed online and hard copy versions of our customer and producer handbooks.

Developed a procedure to receive, sort, and then deliver customer products.

Developed online cooperative management system that allows customers to order
online via email or a shopping cart system, automatically creates invoices for
customers and producers, allows the producers to enter and revise their product
information and prices, displays member contact information, automatically
calculates and displays customer delivery information, provides the cooperative
with producer and customer invoice summary tables showing the amounts owed to
producers, and amounts paid for customer delivery fees and cooperative charges,
and archives each month's information for review in later months.

Customers can pay online for orders or for memberships via our PayPal membership

Deployed extensive internal communications systems including (1)
okfoodret@yahoogroups.com, general discussion of the cooperative, (2)
members@s... listserv, all members with email addresses are
subscribed to this, (3) producers@s... , all producer members
with email addresses are subscribed to this, okfcfinance@yahoogroups.com ,
Oklahoma Food finance committee discussion, okfboard@yahoogroups.com Oklahoma
Food Board of Directors discussion. We have special email addresses for key
volunteers so information can flow directly to the person who will deal with it:
customer@o... and info@s... , general coop
questions or information; treasurer@s... treasurer
questions/issues, orders@s... customer orders,
pricelist@s... producer issues regarding prices and products,
membership@s... membership chairman,
problems@s... trouble ticket reports.

Developed a cooperative administrative team which is Sandra Storey (Chief
Information Officer), Emma McCauley of Red Earth Design (software and website
development and operations), Robert Waldrop (president), John Herndon
(membership chair), Jonalu Johnstone (treasurer), Paulette Rink (assistant
treasurer), Rich Roman (problems).

Organized a Product Standards and Compliance Committee, which reviews all
proposals for new products to ensure that they comply with the cooperative's

Organized a Finance Committee.

Recruited 3 route coordinators, 5 drivers, and 7 pickup site managers.

Managed to operate thus far using volunteers and borrowed space.

Recruited 200 members, 45 of which list themselves as "producers".

Purchased 65 ice chests, of varying sizes, for use on Delivery Day.

Developed three routes which bring producer products inboard on the morning of
Delivery Day and carry back retail orders on the afternoon (Tulsa, Tahlequah,
Waynoka/Enid). A fourth is being planned (Lawton).

Adopted cooperative articles of incorporation that were written and debated over
several months, with numerous "rounds" of public discussion, revision, and then
more discussion and revision. The articles contain strong structures designed to
ensure that the cooperative continues over the long term to serve the needs of
the producer and customer members, who are the only owners of the business,
avoid problems of stranded capital, excessive reserves, and favoritism which
have sometimes been a problem in other cooperative organizations. They also
contain a "poison pill" designed to make it impossible for a large corporation
or another cooperative to buy the business and corporatize the structure. The
bylaws mandate equality among the members of the cooperative, all members can
both buy and sell through the cooperative.

Delivery Day, and other cooperative activities, are emerging as social
occasions, as well as their business purposes.

Developed the Customer Delivery Code, which allows us to tell at a glance where
a product is to be sorted, who it belongs to, whether the customer gets the
product, and which vehicle it rides to the customer on.

Developed standard formats for customer and producer invoices.

Defined the relationship between the customer and producer members of the
cooperative as one of agency. As agents for the producers, we publicize their
products and make them available to our members through our delivery system. As
agents for the customers, we find products and enable the customer members to
purchase and receive them.

Identified pickup places and developed routes to take products from the sorting
locations to those locations or to home or work deliveries.

Deployed a trouble ticket system to identify problems with deliveries and track
resolutions of those problems.

We have a volunteer compensation/reward system established.

We have had two Oklahoma Food banquets.

We have given technical assistance to a group in another state that is working
on a similar project. One of their members observed one of our Delivery days,
and a team from a Nebraska University visited us and observed a different
Delivery day.

We have developed a prototype for classifying our products based on the
production practices used them, but thus far have only implemented classifying
products as certified organic or not certified organic.

We have developed a way to organize the sorting work on delivery day, trying two
different methods during this process. We continue to refine those procedures
based on actual experiences.

We have now completed six successful monthly order delivery cycles (Nov-Dec
2003, and Jan-April 2004), totaling $40,000 in gross revenues.

We have a list of enhancements to our online software that we are working on
prioritizing for implementation.


Transporting refrigerated and frozen items. What we really need are two light
trucks with reefers on them (full size pickups with camper size reefers would
work), or two trailers and with freezers and a generator.

Keep our system working successfully until we get big enough to rent a central
distribution warehouse for our largest sorting operation, Oklahoma City. This
would go a long ways towards solving our refrigeration problem, as we could
equip it with freezers and refrigerators and use the ice chests only for
short-term transportation within the Oklahoma City metropolitan area.

Continue to discover and define the results we need from our computer systems,
and getting those systems developed and implemented.

Develop and implement our financial accounting systems and to put the
cooperative on a sound financial plan, matching income with expenditures..

We may run into regulatory challenges or barriers.

Finding new members, increasing the percent of members who order each month, and
moving first to a twice a month delivery day system, and then to a weekly

Helping our producers to predict future inventory demands (i.e. develop a system
to track what is sold each month and over time, so that at the end of the year
we could say something like, "the cooperative sold X pounds of beef, X pounds of
vegetables, X jars of jam, X bars of soap, etc., not listed by individual
producer, of course, but totals for generic categories of products).

[Non-text portions of this message have been removed]

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