April 14, 2022
Dear EEFC Members,
This evening, the Board of the East End Food Co-op held an information session with members in which we had to make a very difficult announcement. As you are all probably aware, our store has been struggling over the last decade or more as the retail organic/natural food landscape has changed dramatically with more competitors, including the larger conventional chains, placing increasing emphasis on the products which we were initially formed to provide.
The changing market has brought a continuous decline in sales for our Co-op, and we have been struggling to overcome this decline over many years. We are very proud and appreciative of the hard work that our staff members have done to try to address our challenges, in a situation made even more challenging by the complex work-environment caused by the COVID pandemic. We have tried many courses of action – from new margin and merchandising plans, to searching for a larger location where we might expand our product and service offering. Unfortunately, we have reached a point where we are, frankly, out of time to try anything more. Our lease is up in June of this year and we cannot, in good faith, enter negotiations with our landlords who have been more than generous with us over our long tenure in the building. The recent extreme fluctuations in cost of goods have created an additional level of uncertainty for our store operation. The ethical and responsible act is for the Co-op to cease operating the store on Commercial Drive while we have the possibility of an orderly wind-up.
We have explored every alternative we could think of, including offering our staff the opportunity to take the store on as a worker-co-op. Unfortunately, the kind of capital necessary for such a venture is not available. Given this reality, we are sorry to inform you that the Board has had to vote to close our Commercial Drive store prior to the expiration of our lease in June. Sunday, May 15 will be our last day of operation. This is a very emotional and difficult decision, but it is the action we must take to ensure that we are able to make as graceful and responsible an exit as possible for our community of members, staff and suppliers.
We thank you for your loyalty and commitment to the Co-op over the years. Many of you have not only shopped with us through thick and thin – but many of you contributed in other ways to support our Co-op over the decades. We are proud of our legacy of providing jobs, supporting new businesses, and strengthening our local food economy while providing unique and healthy food. We are also very proud that our Co-op community has been instrumental in bringing new values to the grocery market here in Vancouver – from being first to market with organic and bulk foods (decades before to being among the first to stop using plastic bags in our store we many accomplishments to be proud of and we have learned much through the years.
We are also planning a closing celebration to take place in May. Watch for in-store specials in the coming days through store signage and Facebook announcements. We ask that you continue to shop at the Co-op as much as possible while our doors remain open - this will help ensure that our Co-op can fully support our staff and meet our obligations as we go through this difficult transition.
We are grateful for the hard work and dedication of our staff, past and present - and for our wonderful members who have sustained our community-owned enterprise through the years.
Thank you for your understanding and support,
Management and Board
East End Food Co-op
Some Questions and Answers
Why is the Co-op closing the store?
Our sales have been steadily declining over recent years and we have been unable to control margin and costs in such a way to keep the business sustainable?
Why is the Co-op closing now?
The store’s finances have been troubled for several years and we were in an already weak position when the pandemic struck. The last two years have only brought increasing uncertainty and volatility to the world of grocery and, with sales declining, we are now at the end of our resources to keep trying to make it work.
What about the expansion plans?
We had an active expansion committee that was meeting weekly until last fall when it became clear that, given the financial state of our existing store, we would not be able to secure the financing we would need. We were also finding that there was not a lot of available inventory in the real estate market to meet our needs for the new site.
What will happen to the store fixtures?
We are going to try to recoup as much value as we can from the fixtures in the store. Whatever we cannot sell we will donate if we possibly can. All hazardous waste, such as items containing refrigerant, will be disposed of responsibly.
What efforts were made to fix our financial position?
- reviewing and refreshing our product selection
- adopting a new pricing strategy to ensure that we remain affordable and competitive in the marketplace while managing our margin responsibly
- instituting more frequent inventory reporting
- identifying and reducing waste in our operations
- making improvements to our store appearance and merchandising strategy
- introducing our Co-op Basics program which ensures that we have a full selection of pantry staples available at a reliably low-price every day.
- envisioning a new approach to our member-engagement and marketing (in process now) to keep us more top-of-mind with our members, and introduce us to new shoppers
- instituting a loyalty-points program for members
- seeking sites and funding to expand operations for greater buying power and increased selection
What about the workers?
We are very grateful for the hard work and dedication that our employees have brought to the Co-op. We have provided as much notice as we could and we are deeply grateful for their cooperation and professionalism as we have gone through this process. Some of them did explore the option of forming a worker co-operative to take the store on, but financing is a key problem.
I would be interested in supporting a worker co-op - who do I talk to?
Please contact Gus at [email protected] to volunteer.
Will I get my member-equity refunded?
Given our financial position, the Board has put a freeze on equity-refunds in order to protect our ability to meet our obligations to staff and suppliers. The store is closing now but our Co-op will remain in effect. In the event that the Co-op, as an association, does finally wind down, equity will be refunded according to available funds once all other financial obligations have been met. This is in accordance with our bylaws.
Is the membership supposed to vote to close the store?
A member vote would be required to wind up the co-op association, but the Board is responsible for making decisions related to the financial viability of the store operation. The Co-op is remaining an entity for now and following the closure of the store the Board will assess what the options are for moving forward and discuss with the membership at the June AGM.