After months of study, the boards of Wedge Community Co-op, Linden Hills Co-op, and Eastside Food Co-op are asking their members/owners to consider a proposal for the neighborhood grocery stores to merge into a single organization that would have more than 32,000 members and $75 million in sales, reports the Star Tribune.
Wedge Chief Executive Josh Resnik said that pooling accounting, human resources, technology, marketing, purchasing, and other administrative functions would save money, and that the combined stores’ accumulated buying power would result in lower prices for shoppers. Resnik also emphasized the similarity in business philosophies.
According to the plan, stores will retain their names, and no jobs will disappear. The stores’ three separate boards would consolidate into one, and a single general manager would run the revamped operation.
Employees were informed of the proposal Monday afternoon, and members will receive an announcement via mail.
Should the consolidation proposal pass, members of one co-op will become members of the new, merged entity, and member benefits — which include discounts and profit-sharing — will transfer across all stores. The plan would take effect January 2, 2017.
Linden Hills and Eastside would also both benefit from a closer association with Co-op Partners Warehouse, the Wedge’s certified organic wholesale distribution service, as well as the co-op’s commissary/catering operations.
The Wedge opened in 1974 and has 16,500 members; its grocery business has annual sales of $32.5 million, and its warehouse and commissary businesses post an additional $22.5 million in annual sales. Linden Hills dates to 1976 and has 8,900 members and $13.6 million in annual sales. Eastside, the youngest of the three, opened in 2003, and has 6,700 members and posted $9.7 million in annual sales. The three co-ops employ a total of 500 people.
[h/t Star Tribune]