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A new co-op era for grocery?

Sussex Co-op wasn’t sure whether to stay in the supermarket business. Until it held a members’ meeting and really got into the game

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Sentiment and tradition, we are told, have no place in today’s dog-eat-dog retail world. But are there exceptions? Apparently, as evidenced by recent investments in co-op stores.

Take Edmonton and Winnipeg, for instance. In both of these cities, local co-ops are taking over old Safeways that were sold to Federated Co-operatives, by Sobeys, over the winter. Sentiment, meanwhile, is meeting style at the latest Calgary Co-op store.

The sleek and HMR-heavy Crowfoot supermarket was opened in the northwest part of Calgary last September to oohs and aahs.

Calgary Co-op has been in business 58 years. A long time, for sure, but on the other side of the country an even older co-op, the Sussex & Studholm Agricultural Society, in Sussex, N.B., is taking a big stab at reinvention.

Sussex, as any New Brunswicker knows, is where that province’s favourite beverage, Sussex Golden Ginger Ale, was first brewed. But the town, halfway between Saint John and Moncton, is also home to perhaps the country’s oldest co-op, Sussex Co-op, which was founded, in 1841, by area farmers.

READ: Inside Calgary Co-op’s rural renaissance

At first, the co-op’s existence seemed precarious.

At one meeting in 1850, members discovered their finances consisted of a meagre seven pence. Still, the co-op would go on to survive and even thrive. By the 1960s, Sussex had a busy grocery business too, and in 1970 a brand new supermarket was built downtown. Total bill: $85,700.

Fast forward to 2012. The co-op’s connection to local farming is still there. (Sussex is the dairy capital of the Atlantic, after all.) But its grocery store is struggling. At just 5,000 sq. ft., the assortment is limited and aisles are squeezed compared to nearby competitors such as Sobeys and Walmart.

“We were simply not doing any business, so it was a case of get out or in fully,” recalls store manager, Rocky Price.

The decision to close the store or expand in order to stay in business came to a vote, that October, at a meeting of co-op members. Eight hundred showed up and voted to spend $1 million to construct a new store. (Another $856,000 came through the province’s Small Business Investor Tax Credit, topped up further by local fundraising.)

READ: Take a look inside the newest Calgary Co-op

Cut to November 2013 and a new 22,922-sq.-ft. Sussex Co-op supermarket opens as an anchor tenant in the Sussex Mall in the town’s east end.

Just a few months later, the store is proving to be a draw. Weekly traffic has doubled from the old store, and during its first 20 weeks in business, sales topped $2.1 million compared to just over $999,000 for the same period the year prior.

“Moving to the east side of town was a big boost for residents and members living there, especially as most of the other grocery outlets are on the west side,” says Marc Thorne, Sussex’s mayor. “The mall had gone into receivership but with the coop doing so well, new retailers are interested in moving in.”

Sussex has only 4,300 residents, but the town is busy most days. Daily through-traffic is 14,000 cars. It’s this passing trade, plus local residents, that the store aims to reach through key departments such as HMR and fresh.

“We are looking at ways to differentiate [ourselves] from the competition,” says Price, pointing out the store’s large selection of coffee pods, which now includes organic. “We have more than 150 SKUs of pods, and we have tastings so customers can experience [the products].” This category alone contributes about 2.7% of store sales.

Price says that one of his goals is to convince more customers to do their full weekly grocery shop at his store. Focusing on fresh and adding more new local products is one way to achieve that, he says. Likewise, he’s extended hours inline with nearby grocery stores.

The HMR department at the front of the store may also help boost sales.

“It allows easy access to quick, on-the-run meals, while the expanded fresh and spacious aisles make the shopping experience a relaxing one,” says Jamie Smith, business development and retail support manager with Sussex Co-op affiliate Co-op Atlantic in Moncton.

New departments may draw shoppers, but in designing the new store, Price, Smith and others involved were careful not to alienate the co-op’s traditional base and country ethos.

“The store design is a reflection of the long and rich agricultural heritage,” notes Smith.

READ: An interview with Co-op Atlantic’s Paul-Emile Légère

Smith points to the silver silo and red barn facade of the dairy case. A sign above the fridge doors adds a succinct touch of humour: “Milk so fresh, the cow doesn’t even know it’s missing.”

The co-op is also finding unique ways to attract shoppers and indeed, new members, to the association. Member cardholders can avail of discounts from almost 45 other local businesses.

It’s sentimentalism with business savvy. And it’s working.

“As we are seeing in Sussex, co-ops are appealing to a new generation of consumers. And we’re reminding older customers that we are still here, and better,” says Co-op Atlantic CEO, Paul-Emile Légère. Could grocery be entering into a new co-op era?

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