Natural Foods Merchandiser

Weaver Street Market: Jazzing up Southern Naturals

One of the struggles natural foods co-ops wrestle with is image—bulk bins and patchouli-scented, hippified customer-owners. "We all know and fight that perception," says James Watts, operations manager at Weaver Street Market.

He should know. If there are the equivalent of rock stars in the natural foods co-op world, Weaver Street Market has got to be among them. The 15-year-old central North Carolina co-op is as far from the Birkenstocks-only stereotype as a natural foods market can get and still be true to its roots. The market hosts a jazz brunch every Sunday during the summer, hosts Weaver Street Market After Hours on Thursday evenings—a bash featuring food and music—and has one of the largest food-service operations of any independently owned natural foods store in the United States.

"We've remodeled the store four times in 10 years," Watts says.

He's speaking of Weaver Street's original 16,000-square-foot store, which just happens to be located at the busiest intersection in Carrboro. But the Weaver Street Market co-op also has another 5,000-square-foot location in nearby Chapel Hill, and a third store for which it plans to break ground shortly. In addition, the co-op owns a freestanding Italian restaurant called Panzanella about 100 feet away from the Carrboro location. The market's successful in-house artisan bread bakery spawned the restaurant.

But the Weaver Street co-op isn't just about food. True to the cooperative business-model mission, Weaver Street's owners say they focus their efforts on meeting unmet community needs.

"We look at the needs of our town and where the gaps are," says Ruffin Slater, Weaver Street's general manager. "Our particular interest is in building our downtown business community."

Toward that end, Slater says, the co-op is discussing with community members the possibility of starting a bookstore and a car-share co-op. Weaver Street already has launched a housing co-op. "In our town we've seen a pretty large increase in housing prices; people who work here are less able to afford to live here. We're trying to take the speculation out of the housing market," he says.

Because of its diversification, Weaver Street is a standout in the natural foods co-op world, says Robynn Shrader, executive director of the Iowa City, Iowa-based National Cooperative Grocer's Association. "What Weaver Street has done well is to focus on community needs," she says. "They've been willing to look at other unmet needs in their community—anything the community could be better served by. That leaves dollars in the community and allows people who are going to be served in the business to have a say."

Beyond diversification, Weaver Street distinguishes itself by using a variation of the traditional consumer-ownership co-op model. Weaver Street allows both consumers and employees of the co-op to be owners. Consumer members receive a discount when they shop. Employee members pay $500 for a share and receive a dividend at the end of the year. This kind of operating structure is relatively rare in the food co-op world, Shrader says.

The co-op has a seven-member board of directors to which Watts credits much of the co-op's success. "They are focused on the question of what we want to be different in Carrboro as a result of Weaver Street Market, and they challenge management to meet those ends."

To date, the board has steered a relatively straight course toward success. The original market logs about $10 million in sales annually. The new market—a scant three miles from the original—is on track for $3 million in sales in its first full year.

Growth at the original Weaver Street Market slowed to about 10 percent in 2002, however, because of the proximity of the new market to the original store. That the co-op built the new store so close to the original is more testimony to Weaver Street's adherence to principle.

"We were approached by the developers of a large village development with a small shopping district. They wanted a community-based store. The co-op approached the homeowners and said, 'Show us this would be a good business decision.' Sure enough, they were able to raise $300,000 in new investment in the co-op in that community," Watts explains.

Currently, Weaver Street Market has between 5,500 and 6,000 active members who pay $75 for a single-member household lifetime membership and $135 for a two-adult household lifetime membership. But it doesn't rely heavily on membership to make its sales goals. The stores have substantial walk-through business. "In terms of our percentage of sales to owners, we're on the low end of co-ops," Watts says.

The co-op's sales per customer also are on the low end of average because much of its sales come from food service. Indeed, food service makes up more than 30 percent of sales in the original store, which has a 24-well salad bar, a seven-well service hot line, 16 feet of grab-and-go deli items, a full-service coffee bar and a bakery. "We realize people come to us for food and we need to compete with the best and the brightest out there when it comes to providing food," Watts says.

The competition is substantial. A 40,000-square-foot Harris-Teeter supermarket sits about 150 yards away from the original Weaver Street Market; a Whole Foods Market has been three miles away for the past 12 years. Neither of the larger retailers' moves goes unnoticed by Weaver Street, especially in the area of food service. "We've never been afraid to reformat the store to attract and retain customers," Watts says. "We moved the kitchen so many times it should be on wheels."

Nancy Nachman-Hunt is a Boulder, Colo.-based freelance writer.

Natural Foods Merchandiser volume XXIV/number 3/p.52, 56

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