Too Much Success

One of the largest and most-venerable cooperatives in AmericaFair use in Commentary has folded. I read about this in the Garbanzo Gazette, my own small-town co-op’s monthly newsletter.

Berkeley’s co-op was founded in 1937. Back then, many Americans looked favorably on communism with a lower case “c” and people didn’t realize, or denied, that every Communist with a capital “C” country was a dictatorship or oligarchy.

Berkeley was a “first wave” co-op, founded for political reasons but expanding over the years to sell food, hardware, gasoline, and more. On-site childcare was provided as parents shopped and there was even a co-op burial society.

Communes seldom survive much beyond their founders – subsequent generations aren’t as enthused and willing to suffer for the ideal. Perhaps some of that attitude affected Berkeley, but it survived for 80 years and at its peak had over 116,000 members.

There were clear reasons for the failure… Overextending in the Bay Area food marketplace was clearly one and the weirdness of the way their board operated (very contentious) another… [They began cutting programs to save costs.] It was all downhill from there. Garbanzo Gazette

My local co-op opened in 1974 in the “second wave” where co-ops were about “brown rice, organic pintos, tamari and things like that… a quaint little hippie store.” The political angle was still there, but food trends were more important.

I joined (though our co-op is open to non-members) for the bulk dried food and bulk spice sections. The hippie atmosphere continues – incense is a big seller – and some members never step foot in the local Walmart, but that’s not me.

I suppose that’s why our co-op is in financial trouble.

Organic. Non-GMO. Free trade. Cage-free eggs. Quinoa. Supplements. Those trends succeeded throughout America. Huge corporations like Walmart embraced these emerging consumer demands and there are even chains like Whole Foods that specialize in them.

Companies have learned to watch for trends, and buy-out or simply take-over new ideas like meal kits. Blue Apron’s stock is worth half of its IPO and I can buy frozen meal kits at Walmart – fresh kits can’t be far behind. There’s less space for upstarts to persist in the highly-competative grocery marketplace.

My co-op is losing its niche in foods, and the niche of people-who-hate-Walmart simply isn’t big enough. The board is looking for a way to survive, but a recent attempt to add a restaurant failed. Maybe local-sourced food can be a winner, but we’re not a big farming region. Besides, I see one of the smaller, non-Walmart, groceries is selling local meats, so the niche may already be filled.

Berkeley’s demise points to pluses and minuses. More people have access to food trends, and trends will be more standardized than in the past. Crazy trends will spread more quickly with corporate power behind them, but so will beneficial ones.

Of course, when a trend runs its course and is dropped by Walmart (which, for example, has very little bulk dried food today, and when’s the last time you saw a giant-chain-store salad bar), small competitors don’t benefit because they’re long gone.

You can’t fight progress. At least, not for long.
Read more about the Berkeley co-op.

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