Common Ground reaches fund goal a month early

URBANA — It's the little co-op that could.

The Common Ground Food Co-Op, which launched over 30 years ago in the basement of a building on campus, moved to a new space in Lincoln Square Village three years ago, only to embark on another expansion that will be funded in part by its growing number of members.

And the three-month campaign to drum up loans from its members reached its goal a month early, its manager announced Monday.

"There's huge growth in demand for local foods and, despite the recession, in organic foods. ... People want a connection with their foods and their farmers," said Jacqueline Hannah, Common Ground's general manager.

The expansion, which will triple the size of the local and organic foods store, comes after owner roundtables and surveys in which members of the co-op shared their dreams for a larger space. They spoke of an expanded deli, an espresso bar, an in-house bakery, a local meats case and more.

The real test to determine how badly they wanted those things was if members stepped up with loans, Hannah said.

They did.

About 40 percent of the $1.6 million project will be funded by loans issued to the co-op by its owner members. In about 60 days, the co-op has raised $665,000 in loans.

The co-op's primary lender on the expansion is Minnesota-based Northcountry Cooperative Development Fund, which assisted the shop with its move to Lincoln Square Village in 2008. The group also is working with Champaign County Economic Development Corp. on a possible community loan, Hannah said.

In addition, the shop has cash on hand that it has been saving these last three years. Most relocated co-ops don't turn a profit until after three years; Common Ground turned a profit 10 months after moving to Lincoln Square, Hannah said.

"It's a whirlwind, but it's amazing," said Jessy Ruddell, who has been produce manager at the co-op for five years.

"When we came here, we weren't sure how things would work out. We knew we'd do better but didn't really know exactly how or that we'd be needing to expand in three years," Ruddell said.

Produce sales account for about 25 percent of the co-op's sales, compared with a 15 percent average for natural-foods stores and co-ops and about 8 percent at regular grocery stores, she said.

The co-op has been able to do such things as ask the farmers to grow certain products for their customers because they can prove they have the demand for those products, she said. Last year, for example, they bought winter squash seeds and asked a farmer to grow them for their customers.

"We're hoping to do a lot more of that," Ruddell said.

The produce section in the expanded store will be larger and will have a greater selection of items for sale.

The current space — 3,900 square feet total — includes 2,100 for retail. The new space, totaling 9,500 square feet, will have 6,000 square feet for retail. The co-op will expand into space north and west of the current store.

The store's deli, currently operating as a grab-and-go, will transition into a hot-food bar with made-to-order foods and it will include an espresso bar and have some in-store seating, according to Hannah.

A local meats case will be added and the store will start baking breads in-house. They will start to sell refrigerated beer and they'll have a small selection of organic and local wines.

An educational classroom, with a teaching kitchen in it, is also included in the plans.

"I think I'm most excited about the classroom space because it's what makes us different. It sets us apart," said Hannah, who has held workshops on how families can whip up affordable, healthy meals.

The $665,000 raised so far represents investments by 120 owners. The loans, which start at $1,000, are outright and made directly to the co-op, Hannah said. The term can be for five or 10 years and the owner can choose among several variable interest rates.

The average owner loan size has been for $4,000, she said.

Even though the co-op reached its goal, "we'll keep accepting loans," Hannah said. "Now we're secured, we can go ahead with our primary lender and start planning the build-out date," she said.

Construction is expected to start in October and will take about six months.

The store will remain open the entire time, and construction will be phased in pieces.

The co-op is up to 3,890 owner-members. To become a member costs $60 and members receive discounts when shopping at the store.

The store is open to the public.

As for the staff, it is now up to 41 employees, equal to 25 full-time workers, Hannah said.

Co-op member owner Jan Kruse of Urbana said she stops by the store weekly to buy salads, fair trade coffee, nuts and other products.

She heard about the announcement on Monday and decided to stop by the event in person "because this is something I really appreciate," she said. Her family was one of the first members to loan money for the move to Lincoln Square in 2008. Among the many reasons she said she supports the co-op is the jobs it brings to the community and she said she appreciated the fact that the co-op planned to use a local construction firm to manage the expansion.

"I'm so glad it's here," she said.

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bookworm wrote on August 02, 2011 at 8:08 am

Congratulations! The store is so much more attractive than its former location. The staff seem much happier, too :)

Smultronstallet wrote on August 04, 2011 at 10:08 pm

I'm happy for their success, but only because I like the idea of co-ops. Even if I were a member, I could never afford to shop there on a regular basis. Last time I checked, an item I purchase regularly at another grocery store costs more than twice as much at Common Ground! Nothing can justify such an outrageous markup.