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That Ain't Natural

The growing Boise Co-op faces challenges from Whole Foods, and members too

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Adolescence is hard on everyone. For the Boise Co-op, that cherished anomaly of local grocers, it has meant difficult discussions with friends, neighbors and those who knew it when. Some longtime members now say privately that it is time for the Boise Co-op to "grow up."

On the bright side, the eclectic market is thriving, economically. As of July 1, when the fiscal year ended, the Co-op cleared $21 million in sales, showing a robust 20 percent growth. Customers continue to jam its tiny parking lot; last year the Co-op signed up an average of 300 new members per month. Long-term debts have been paid off, and the store's relationship with the owner of its property, Californian Jim Wisner, is strong.

But that is about where the positive notes end. On other issues, the store's talks with members have become tense.

Since its inception as a food-buying club in 1973, the Co-op has metamorphosed into a high-end market catering to expensive tastes, but also one that gets many of its products from local farmers and producers. The store presents customers with an array of organic and natural food options that, so far, is unmatched locally.

But what it has ceased to resemble, many people believe, is a true natural foods Co-operative, where members feel like they are a valuable component of its day-to-day operation. At a recent meeting of members and the store's board of directors, many people stood up to say that, as much as they loved shopping at the Co-op, they did not feel like they were a part of it.

"I get the feeling our goal today is to sign up 300 people a month and forget the people that were already here," said Patrick Haas, who tried, unsuccessfully, to gain a seat on the Co-op's board of directors. "It seems like we're hell-bent for leather to go someplace, and we don't know where that is."

About 80 people attended Saturday's annual board meeting in the basement of the St. Joseph's Parish Hall. Haas was joined in his frustration by several other members, including Ned Fowkes, who rose to tell the five-member board that he and other members felt "a lot of frustration."

"We're in the dark," Fowkes said. "We don't have a clue about what's going on."

Part of what's going on is a scuffle within the immediate neighborhood. Just across the cramped parking lot from the main storefront, Wisner also owns a series of storefronts, including the Eyes Of The World market, an imports store that owner Mishel VandenBusch has operated since 1996. When her five-year lease with Wisner ended in 2001, the two began a long series of negotations about the property. After discussing a move into a storefront once occupied by Hill's Valu-Rite Pharmacy, VandenBusch and Wisner came to an impasse. This fall, he asked her to move out of her store by January 15. Wisner said he then approached the Co-op, which is now set to move the majority of its wine and beer sales into the old pharmacy space.

"I can't control how [VandenBusch] runs her business," Wisner told the board. "I've got to run mine." He said VandenBusch was "a good businessperson" who he believes "made a mistake."

VandenBusch is now looking for another location. Her departure angers some Co-op devotees who believe the Co-op has designs on the Eyes Of The World property, something the Co-op's management has not addressed.

"The Co-op's not doing this. I'm doing it," said Wisner, who added that he has been getting "hate mail" over the subject.

"I've had an excellent relationship with Jim [Wisner] all along, but he's trying to keep his relationship with the Co-op," VandenBusch said. "It's a money thing."

The Co-op's expansion into the 4,300-square-foot pharmacy site would allow the store to highlight its wine business, which is thriving, said Ken Kavanaugh, the general manager of the Co-op.

But not all of the Co-op's expansions have been so successful. The Flipside Cafe, which is owned by the Co-op and is next door to Eyes Of The World, is a hip eatery whose menu is based on locally produced and organic products sold by the Co-op.

"It's a huge success in many ways, but not financially," said Kavanaugh.

Since opening in 2005, the cafe has lost $434,309 in operating costs, according to the Co-op's financial statements.

"It's clearly a challenge for us," said Paul Street, a member of the Co-op's board. "It's probably our biggest concern right now."

That is, until the neighborhood changes. The elephant in the room last Saturday was the prospect of Whole Foods Market moving a store to Boise. As reported by the Idaho Business Review, the natural-foods chain plans to locate a store at the corner of Broadway Avenue and Front Street, just over one mile from the Co-op's North End location at 888 W. Fort St. According to financial reports, the lease for the Boise store has already been signed. The 54,000-square-foot store, set to open in the spring of 2008, would be the chain's first in Idaho.

Like the Co-op, business for Whole Foods has been good: For the fourth quarter that ended in September, sales increased 16 percent, to $1.3 billion.

Kavanaugh said there was a "potential for a real war."

In fact, Saturday's session occasionally resembled a town-hall meeting from a Western movie, wherein a troubled townfolk fret and debate over the arrival of a gang of desperadoes.

"The only way we can win this so-called battle with Whole Foods is to cooperate," said Brent Boyer, a longtime member who also tried, unsuccessfully, to win a seat on the board of directors.

The frustration that longtime members are feeling with the Co-op could wind up hampering the store's ability to compete with Whole Foods. According to Kelly Smith, director of marketing for the National Cooperative Grocers Association in Iowa, it's those long-term members that can help keep a local store afloat in the wake of competition. While a local Co-op's sales might dip at first, as customers check out a new competitor, they eventually rebound, Smith said, "because of a sense of ownership."

Any dissatisfaction longtime members have with the Boise Co-op is serious, Smith said.

"Those are issues that need to be addressed and, I think, rather quickly," she said.

Co-op marketing director Jodi Peterson said in the wake of Saturday's meeting that her job had "redefined itself."

"I realized there's a better use of our advertising dollars," Peterson said. Part of that, she said, means communicating more directly with members new and old about what's going on in their store.

"We're having trouble taking care of our different customer bases," Peterson said. "We have so many now."

The Co-op usually places a monthly advertising circular into a Sunday edition of the Idaho Statesman, Peterson said, that also serves as a Co-op newsletter. That may not be enough, she said.

"I realized I have a lot more education to provide, to the public," Peterson said. "I think that's growing pains."

One concrete change shoppers might expect right away is the addition of a bulletin board in the store, where customers and managers can exchange news and suggestions about the store. Peterson said that comment board should be in place soon.

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