Seward Co-op: Building a Community Around Healthy, Natural Foods

Seward Co-op (Seward) is a community-owned grocery store serving members and customers alike in Minneapolis, Minn. The cooperative – named after its neighborhood – opened its doors in 1972 during a national boom of cooperative businesses.
“Seward was founded by individuals who were looking for whole foods products they couldn’t find elsewhere,” says Sean Doyle, general manager of Seward. “Our founders were members of the anti-war and women’s movement and environmental and civil rights activists of the time. There was a mushrooming of cooperatives during that period in Minneapolis. The Twin Cities had a lot of them forming. We were the third to form and are currently the oldest one remaining.”
Cooperatives are founded on a different business structure than most grocery operations, and Seward is no exception. “We obtain our owner investment in part through voluntary purchase of membership stock,” explains Doyle. A sign above the entrance to Seward reads, “Everyone welcome,” and it is important to note that customers are not required to be members to shop at Seward.
“The cooperative was founded on voluntary labor, but it quickly evolved into a paid collective,” says Doyle. “The cooperative then shifted to being consumer-owned and managed by a general manager in the early ’80s, and that’s how we’ve operated since. We’re consumer-owned, with a $75 buy-in for stock. Our owners get a share of the profits based on their purchases.”
The cooperative maintains an educational classroom on the premises, as well. The classroom assists Seward in raising awareness about healthful food and also teaching members about cooperatives, ultimately enhancing the entire experience.
Green Goodies for All
Seward offers a broad range of foods, as the grocer carries bulk items, baked goods, produce, dairy, meat and seafood, in addition to offering a deli along with many wellness products. “We put an emphasis on natural and organic foods,” notes Doyle. “We have a focus on perishables like our butcher shop, produce, cheese and scratch-made deli. We also participate in the P6 program.”
The P6 program is derived from the sixth international principle of cooperatives: cooperation amongst cooperatives. P6 is a trade movement that connects cooperatives through sharing products, resources and best practices.
“About 40 percent of our products come from small, local or cooperative producers,” explains Doyle. “These criteria are what qualify these products for the P6 label. This is very important to our consumers who are interested in supporting healthful food from small and cooperatively owned producers.”
Seward is also a member of National Cooperative Grocers Association (NCGA). NCGA is a purchasing, marketing and training cooperative with more than 100 members. NCGA aggregates the purchasing of Seward and other cooperatives in order to lower cost of goods and be more competitive in the marketplace. “Not only do we get very favorable pricing through our cooperative association, but we also have more resources for training and marketing,” adds Doyle.
While Seward’s commitment to local and natural food sets the cooperative apart from other grocers, Doyle still faces stiff local competition. Two big-box stores in the immediate area offer lower prices for consumers who are focused on price, and the big-box stores are not the only competition. With four cooperatives, two Trader Joe’s and two Whole Foods within five miles of Seward, the natural foods market in the Twin Cities is very competitive.
In order to gain an edge, the cooperative also strives to cater to a diverse market. “We are part of a community with a large immigrant population,” says Doyle. “Our immediate neighborhood has multiple stores that serve the East African community, and there is also a large store that does Pan-Asian products. We’re always looking at how to optimize our own operations and satisfy our customers. We recently completely renovated our sales floor here. It was a half-million-dollar project, and we laid it out focusing on giving our perishable departments more space.”
According to Doyle, unlike many urban areas in the United States, where there are large Latin American or Asian populations, the Seward neighborhood has a concentrated population of East Africans, with the majority from Somalia and Ethiopia. Many members of the local immigrant community are employed at the cooperative.
The Seward team makes an effort to promote sharing cultures through the products the cooperative sells. “We have 220 employees,” elaborates Doyle. “A lot of them are Ethiopian, so we are really connected to that community. We have a deli presentation that features different cultural foods on a regular basis. For example, we offer products like doro wot, an Ethiopian chicken stew, along with banh mi, which are Vietnamese sandwiches. Other departments sell berbere, teff and injera, all products that cater to the East Africans in our neighborhood.”
Moving on Up with a Green Theme
The grocer may have competition, but Doyle and his employees have managed to prosper. Seward moved to its current location in January 2009. “We’ve more than doubled our sales since our move,” says Doyle. “We have a huge deli and a meat department that does primal cuts and has a very popular sausage program.”
Seward’s new LEED Gold-certified building is 26,000 square feet, again enhancing the cooperative’s green theme. “We financed our relocation with a New Markets Tax Credit investment because we are in a low-income community,” explains Doyle. “The new building cost about $10.5 million, out of which about $3 million was of our own resources. We raised $1.5 million through our member investments to put our owners’ stake into the project, and we sold our previous location.”
While the move came at a difficult economic time, Doyle says it was important for his team to develop a space to represent the community’s standards. “We had to jump through some hoops to achieve LEED Gold certification, but overall we were able to become sort of a beacon of hope to people,” he recalls. “Cooperatives tend to do a little better during recessions. I think some of that is due to the desire people have to be a part of a community during hard times. As a community-owned cooperative, we are able to meet that need.”
The community focus is at the heart of the cooperative, including members, consumers and employees. Seward works tirelessly to be accessible to all income levels. Unlike many natural foods stores, Seward accepts SNAP and WIC, even if it means carrying mass-market products like Cheerios. “We don’t want to deny people on public assistance access to natural foods, so we comply with program standards that require us to stock some conventional products on our shelves,” says Doyle.
One area the cooperative was unwilling to compromise on was how it sources its eggs. The WIC program requires that egg prices be at a retail price point below the wholesale price of cage-free eggs. In order not to support Concentrated Animal Feeding Operation (CAFO) egg producers, the Seward subsidizes egg prices for WIC customers. Seward spent more than $5,000 on this effort in 2012.
By prioritizing people and ethics over profits, Seward has provided a positive environment – not just for shoppers – but also for the employees. “We have very high employee satisfaction scores,” says Doyle. “One of our core beliefs is that shelves don’t sell products, people do. So we work very hard at creating an environment that satisfies our employees’ basic needs. This includes good benefits, as well as a say in the cooperative’s operations. Cultivating a positive work culture builds loyalty to the cooperative in much the same way the ownership structure does for shoppers.”
Seward continues to grow at a stable and sustainable rate, happily and healthily. Doyle would like to see a second location in the future, but nothing is set in stone for Seward just yet. “We have established a long-term vision that includes opening a second food-based business, which could be a second retail location or a value-added production facility for natural meats, sausages and meat smoking,” Doyle says. “We may even do it as a retail/processing operation. We’re evaluating a lot of options right now, but we haven’t established a specific plan yet.”
The cooperative’s membership and its devotion to a healthy, natural lifestyle offer the community endless possibilities. The one certainty for the five-year plan is that Seward Co-op will continue to put people first, providing diverse, healthy, informed options for consumers, members and employees alike.